75744 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

OFFICE OF PERSONNEL 

MANAGEMENT 

5 CFR Part 890 

RIN 3206–AO48 

DEPARTMENT OF THE TREASURY 

Internal Revenue Service 

26 CFR Part 54 

[REG–122319–22] 

RIN 1545–BQ55 

DEPARTMENT OF LABOR 

Employee Benefits Security 

Administration 

29 CFR Part 2590 

RIN 1210–AC17 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Centers for Medicare & Medicaid 

Services 

45 CFR Part 149 

[CMS–9897–P] 

RIN 0938–AV15 

Federal Independent Dispute 

Resolution Operations 

AGENCY: Office of Personnel 

Management; Internal Revenue Service, 

Department of the Treasury; Employee 

Benefits Security Administration, 

Department of Labor; Centers for 

Medicare & Medicaid Services, 

Department of Health and Human 

Services. 

ACTION: Notice of proposed rulemaking. 

SUMMARY: This document sets forth 

proposed rules related to certain 

provisions of the No Surprises Act 

regarding the Federal independent 

dispute resolution (IDR) process, which 

was established as part of the 

Consolidated Appropriations Act, 2021 

(CAA). These proposed rules would set 

forth new requirements relating to the 

disclosure of information that group 

health plans and health insurance 

issuers offering group or individual 

health insurance coverage must include 

along with the initial payment or notice 

of denial of payment for certain items 

and services subject to the surprise 

billing protections in the No Surprises 

Act. These proposed rules would also 

require plans and issuers to 

communicate information by using 

claim adjustment reason codes (CARCs) 

and remittance advice remark codes 

(RARCs), as specified in guidance, when 

providing any paper or electronic 

remittance advice to an entity that does 

not have a contractual relationship with 

the plan or issuer. This document also 

proposes to amend certain requirements 

related to the open negotiation period 

preceding the Federal IDR process, the 

initiation of the Federal IDR process, the 

Federal IDR dispute eligibility review, 

and the payment and collection of 

administrative fees and certified IDR 

entity fees. This document also 

proposes to define bundled payment 

arrangements, amend requirements 

related to batched items and services, 

and amend the rules for extensions of 

timeframes due to extenuating 

circumstances. Additionally, this 

document proposes to require plans and 

issuers to register in the Federal IDR 

portal. In accordance with Federal law, 

a summary of these rules may be found 

at https://www.regulations.gov/. 

DATES: To be assured consideration, 

comments must be received at one of 

the addresses provided below by 

January 2, 2024. 

ADDRESSES: Written comments may be 

submitted to the addresses specified 

below. Any comment that is submitted 

will be shared among the Department of 

the Treasury, the Department of Labor, 

the Department of Health and Human 

Services (the Departments), and the 

Office of Personnel Management. Please 

do not submit duplicates. 

Comments will be made available to 

the public. Warning: Do not include any 

personally identifiable information 

(such as name, address, or other contact 

information) or confidential business 

information that you do not want 

publicly disclosed. Comments are 

posted on the internet exactly as 

received and can be retrieved by most 

internet search engines. No deletions, 

modifications, or redactions will be 

made to the comments received, as they 

are public records. Comments may be 

submitted anonymously. 

In commenting, refer to file code RIN 

0938–AV15. Because of staff and 

resource limitations, the Departments 

cannot accept comments by facsimile 

(FAX) transmission. 

Comments, including mass comment 

submissions, must be submitted in one 

of the following three ways (please 

choose only one of the ways listed): 

1. Electronically. You may submit 

electronic comments on this regulation 

to https://www.regulations.gov. Follow 

the ‘‘Submit a comment’’ instructions. 

2. By regular mail. You may mail 

written comments to the following 

address ONLY: Centers for Medicare & 

Medicaid Services, Department of 

Health and Human Services, Attention: 

CMS–9897–P, P.O. Box 8016, Baltimore, 

MD 21244–8016. 

Please allow sufficient time for mailed 

comments to be received before the 

close of the comment period. 

3. By express or overnight mail. You 

may send written comments to the 

following address ONLY: Centers for 

Medicare & Medicaid Services, 

Department of Health and Human 

Services, Attention: CMS–9897–P, Mail 

Stop C4–26–05, 7500 Security 

Boulevard, Baltimore, MD 21244–1850. 

For information on viewing public 

comments, see the beginning of the 

SUPPLEMENTARY INFORMATION section. 

FOR FURTHER INFORMATION CONTACT: 

Padma Babubhai Shah, Office of 

Personnel Management, at 202–606– 

4056; Shira B. McKinlay, Internal 

Revenue Service, Department of the 

Treasury, at 202–317–5500; Elizabeth 

Schumacher or Shannon Hysjulien, 

Employee Benefits Security 

Administration, Department of Labor, at 

202–693–8335; Zarah Ghiasuddin or 

Bryan Kirk, Centers for Medicare & 

Medicaid Services, Department of 

Health and Human Services, at 301– 

492–4308. 

Customer Service Information: 

Information from the Office of Personnel 

Management (OPM) on health benefits 

plans offered under the Federal 

Employees Health Benefits (FEHB) 

Program can be found on the OPM 

website (http://www.opm.gov/ 

healthcare-insurance/healthcare/). 

Individuals interested in obtaining 

information from the Department of 

Labor (DOL) concerning employmentbased health coverage laws may call the 

Employee Benefits Security 

Administration (EBSA) Toll-Free 

Hotline at 1–866–444–EBSA (3272) or 

visit the DOL’s website (www.dol.gov/ 

agencies/ebsa). In addition, information 

from the Department of Health and 

Human Services (HHS) on private 

health insurance coverage and coverage 

provided by non-Federal governmental 

group health plans can be found on the 

Centers for Medicare & Medicaid 

Services (CMS) website (http://

www.cms.gov/marketplace), information 

on health care reform can be found at 

http://www.healthcare.gov, and 

information on surprise medical bills 

can be found at http://www.cms.gov/ 

nosurprises. 

SUPPLEMENTARY INFORMATION: 

Inspection of Public Comments: 

Comments received before the close of 

the comment period are available for 

viewing by the public, including any 

personally identifiable or confidential 


lotter on DSK11XQN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75745 

1Public Law 116–260 (Dec. 27, 2020). 

2Section 102(d)(1) of the No Surprises Act 

amended the Federal Employees Health Benefits 

Act, 5 U.S.C. 8901 et seq., by adding a new 

subsection (p) to 5 U.S.C. 8902. Under this new 

provision, each FEHB Program contract must 

require a carrier to comply with requirements 

described in sections 9816 and 9817 of the Code, 

sections 716 and 717 of ERISA, and sections 

2799A–1 and 2799A–2 of the PHS Act (as 

applicable) in the same manner as these provisions 

apply with respect to a group health plan or health 

insurance issuer offering group or individual health 

insurance coverage. 

3 86 FR 36872 (July 13, 2021). 

4 86 FR 55980 (Oct. 7, 2021). 

5 87 FR 52618 (Aug. 26, 2022). 

6References to a ‘‘participating facility’’ in this 

preamble mean a ‘‘participating health care 

facility,’’ as defined at 26 CFR 54.9816–3T, 29 CFR 

2590.716–3, and 45 CFR 149.30. 

7The interim final rules also include interim final 

regulations under 5 U.S.C. 8902(p) issued by OPM 

that specify how certain provisions of the No 

Surprises Act apply to health benefit plans offered 

by carriers under the Federal Employees Health 

Benefits Act. These provisions apply to carriers in 

the FEHB Program with respect to contract years 

beginning on or after January 1, 2022. The 

disclosure requirements at 45 CFR 149.430 

regarding patient protections against balance billing 

are applicable as of January 1, 2022. 

8See Tex. Med. Ass’n, et al. v. U.S. Dep’t of 

Health and Human Servs., 587 F. Supp. 3d 528 

(E.D. Tex. 2022) (TMA I), Tex. Med. Ass’n, et al. v. 

U.S. Dep’t of Health and Human Servs., Case No. 

6:22–cv–372 (E.D. Tex.) (Feb. 6, 2023) (TMA II), 

Tex. Med. Ass’n, et al. v. U.S. Dep’t of Health and 

Continued 

business information that is included in 

a comment. The Departments post 

comments received before the close of 

the comment period on the following 

website as soon as possible after they 

have been received: http://

www.regulations.gov. Follow the search 

instructions on that website to view 

public comments. The Departments will 

not post on Regulations.gov public 

comments that make threats to 

individuals or institutions or suggest 

that the commenter will take actions to 

harm an individual. The Departments 

continue to encourage individuals not to 

submit duplicative comments. The 

Departments will post acceptable 

comments from multiple unique 

commenters even if the content is 

identical or nearly identical to other 

comments. 

I. Background 

A. Preventing Surprise Medical Bills and 

Establishing the Federal IDR Process 

Under the Consolidated Appropriations 

Act, 2021 

On December 27, 2020, the 

Consolidated Appropriations Act, 2021 

(CAA) was enacted.1 Title I, also known 

as the No Surprises Act, and title II 

(Transparency) of Division BB of the 

CAA amended chapter 100 of the 

Internal Revenue Code (Code), Part 7 of 

the Employee Retirement Income 

Security Act (ERISA), and title XXVII of 

the Public Health Service Act (PHS Act). 

The No Surprises Act provides Federal 

protections against surprise billing by 

limiting out-of-network cost sharing and 

prohibiting balance billing in many of 

the circumstances in which surprise 

bills most frequently arise. In particular, 

the No Surprises Act added new 

provisions applicable to group health 

plans and health insurance issuers 

offering group or individual health 

insurance coverage. Section 102 of the 

No Surprises Act added section 9816 of 

the Code, section 716 of ERISA, and 

section 2799A–1 of the PHS Act, which 

contain limitations on cost sharing and 

requirements regarding the timing of 

initial payments and notices of denial of 

payment by plans and issuers for 

emergency services furnished by 

nonparticipating providers and 

nonparticipating emergency facilities, 

and for non-emergency services 

furnished by nonparticipating providers 

with respect to patient visits to 

participating health care facilities, 

generally defined as hospitals, hospital 

outpatient departments, critical access 

hospitals, and ambulatory surgical 

centers.2

Section 103 of the No Surprises Act 

established a Federal IDR process that 

plans and issuers and nonparticipating 

providers and facilities may utilize to 

resolve certain disputes regarding outof-network rates under section 9816 of 

the Code, section 716 of ERISA, and 

section 2799A–1 of the PHS Act. 

Section 105 of the No Surprises Act 

added section 9817 of the Code, section 

717 of ERISA, and section 2799A–2 of 

the PHS Act. These sections contain 

limitations on cost sharing and 

requirements for the timing of initial 

payments and notices of denial of 

payment by plans and issuers for air 

ambulance services furnished by 

nonparticipating providers of air 

ambulance services and allow plans and 

issuers and nonparticipating providers 

of air ambulance services to utilize the 

Federal IDR process. 

The No Surprises Act also added 

provisions to title XXVII of the PHS Act 

in a new part E that apply to health care 

providers, facilities, and providers of air 

ambulance services, such as 

prohibitions on balance billing for 

certain items and services and 

requirements related to disclosures 

about balance billing protections. 

The Departments of the Treasury, 

Labor, and HHS (the Departments), 

along with the Office of Personnel 

Management (OPM), are issuing 

regulations in phases that implement 

provisions of the No Surprises Act and 

have issued multiple rulemakings since 

2021 to implement various provisions. 

More specifically relevant to this 

proposed rulemaking, the Departments 

and OPM issued interim final rules (July 

2021 interim final rules 3 and October 

2021 interim final rules),4 and the 

Departments issued final rules (August 

2022 final rules) 5 implementing 

provisions of sections 9816 and 9817 of 

the Code, sections 716 and 717 of 

ERISA, and sections 2799A–1 and 

2799A–2 of the PHS Act. These rules 

implement provisions to protect 

consumers from surprise medical bills 

for emergency services, non-emergency 

services furnished by nonparticipating 

providers with respect to patient visits 

to participating facilities 6 in certain 

circumstances, and air ambulance 

services furnished by nonparticipating 

providers of air ambulance services. 

These rules also implement provisions 

to establish a Federal IDR process to 

determine payment amounts when there 

is a dispute between plans or issuers 

and providers, facilities, or providers of 

air ambulance services about the out-ofnetwork rate for these services in cases 

where a specified State law or an 

applicable All-Payer Model Agreement 

does not provide a method for 

determining the total amount payable. 

The July 2021 interim final rules and 

October 2021 interim final rules 

generally apply to plans and issuers 

(including grandfathered health plans) 

for plan years (in the individual market, 

policy years) beginning on or after 

January 1, 2022, and to health care 

providers, facilities, and providers of air 

ambulance services for items and 

services furnished during plan years (in 

the individual market, policy years) 

beginning on or after January 1, 2022.7

The August 2022 final rules became 

effective October 25, 2022, and are 

applicable for items and services 

provided or furnished on or after 

October 25, 2022, for plan years (in the 

individual market, policy years) 

beginning on or after January 1, 2022. 

As discussed in sections I.D and I.F of 

this preamble, certain provisions of 

these rules relating to the methodology 

for calculating the qualifying payment 

amount (QPA), the information that a 

certified IDR entity must consider in 

making a payment determination, the 

establishment of the administrative fee 

to use the IDR process, and certain 

restrictions on the qualified IDR items 

or services that may be considered 

jointly as part of a batched 

determination have been vacated 8 by 


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75746 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

Human Servs., Case No. 6:22–cv–450–JDK (E.D. 

Tex. Aug. 24, 2023) (TMA III), and Tex. Med. Ass’n, 

et al. v. U.S. Dep’t of Health and Human Servs., 

Case No. 6:23–cv–00059–JDK, (E.D. Tex. Aug. 3, 

2023) (TMA IV). 

9 88 FR 65888 (Sept. 26, 2023). 

10 86 FR 36888; 26 CFR 54.9816–6T(d)(1)(iii), 29 

CFR 2590.716–6(d)(1)(iii), and 45 CFR 

149.140(d)(1)(iii). For guidance regarding the 

certification statement in light of the decision in 

TMA III, see U.S. Department of Health and Human 

Services, U.S. Department of Labor, U.S. 

Department of the Treasury, Office of Personnel 

Management, FAQs about Consolidated 

Appropriations Act, 2021 Implementation Part 62 

(Oct. 6, 2023), Q3, available at https://www.dol.gov/ 

sites/dolgov/files/EBSA/about-ebsa/our-activities/ 

resource-center/faqs/aca-part-62.pdf and https://

www.cms.gov/files/document/faqs-part-62.pdf. 

11 86 FR 36899; 26 CFR 54.9816–6T(d)(1)(iv), 29 

CFR 2590.716–6(d)(1)(iv), and 45 CFR 

149.140(d)(1)(iv). 

12 86 FR 36899; 26 CFR 54.9816–6T(d)(1)(v), 29 

CFR 2590.716–6(d)(1)(v), and 45 CFR 

149.140(d)(1)(v). 

13As discussed further in section II.C. of this 

preamble, this proposed rule would add a reference 

to providers of air ambulance services in 26 CFR 

54.9816–6T(d)(2), 29 CFR 2590.716–6(d)(2), and 45 

CFR 149.140(d)(2). 

14 26 CFR 54.9816–6T(d)(2)(i), 29 CFR 2590.716– 

6(d)(2)(i), and 45 CFR 149.140(d)(2)(i). Under the 

July 2021 interim final rules, plans and issuers are 

required to calculate the QPA using underlying fee 

schedule rates or derived amounts when the plan 

or issuer has sufficient information to calculate the 

median of its contracted rates but the payments 

under the contractual agreements are not on a feefor-service basis (such as bundled or capitation 

payments). 86 FR 36893; 26 CFR 54.9816– 

6T(b)(2)(iii), 29 CFR 2590.716–6(b)(2)(iii), 45 CFR 

149.140(b)(2)(iii). Plans and issuers are not 

otherwise permitted to use underlying fee schedule 

rates or derived amounts to calculate the QPA. 

15 86 FR 36899; 26 CFR 54.9816–6T(d)(2)(ii), 29 

CFR 2590.716–6(d)(2)(ii), and 45 CFR 

149.140(d)(2)(ii). 

16 86 FR 36899; 26 CFR 54.9816–6T(d)(2)(iii), 29 

CFR 2590.716–6(d)(2)(iii), and 45 CFR 

149.140(d)(2)(iii). 

17 86 FR 36899; 26 CFR 54.9816–6T(d)(2)(iv), 29 

CFR 2590.716–6(d)(2)(iv), and 45 CFR 

149.140(d)(2)(iv). 

the United States District Court for the 

Eastern District of Texas (District Court). 

On September 26, 2023, the 

Departments published the Federal IDR 

Process Administrative Fee and 

Certified IDR Entity Fee Ranges 

Proposed Rules (IDR Process Fees 

proposed rules) 9 to amend the 

administrative fee and certified IDR 

entity fee provisions in the October 

2021 interim final rules to provide 

additional guidance and promote 

transparency in the administrative fee 

calculation and certified IDR fee ranges. 

If finalized, the rules would apply for 

disputes initiated on or after the later of 

the effective date or January 1, 2024. 

B. July 2021 Interim Final Rules 

The July 2021 interim final rules 

implement sections 9816(a)–(b) and 

9817(a) of the Code, sections 716(a)–(b) 

and 717(a) of ERISA, and sections 

2799A–1(a)–(b), 2799A–2(a), 2799A–7, 

2799B–1, 2799B–2, 2799B–3, and 

2799B–5 of the PHS Act. 

The No Surprises Act directs the 

Departments to specify the information 

that a plan or issuer must share with a 

nonparticipating provider or 

nonparticipating emergency facility 

when determining the QPA. Therefore, 

26 CFR 54.9816–6T(d), 29 CFR 

2590.716–6(d), and 45 CFR 149.140(d) 

require that plans and issuers make 

certain disclosures about the QPA with 

each initial payment or notice of denial 

of payment, and that plans and issuers 

provide certain additional information 

upon the request of the provider, 

facility, or provider of air ambulance 

services. This information must be 

provided in writing, either on paper or 

electronically, to a nonparticipating 

provider, facility, or provider of air 

ambulance services, as applicable, when 

the QPA serves as the recognized 

amount. 

With an initial payment or notice of 

denial of payment, a plan or issuer must 

provide the QPA for each item or 

service involved, as well as a statement 

certifying that based on the 

determination of the plan or issuer: (1) 

the QPA applies for purposes of the 

recognized amount (or, in the case of air 

ambulance services, for calculating the 

participant’s, beneficiary’s, or enrollee’s 

cost sharing), and (2) each QPA shared 

with the provider, facility, or provider 

of air ambulance services was 

determined in compliance with the 

methodology outlined in the July 2021 

interim final rules.10

A plan or issuer is also required to 

provide a statement that if the provider, 

facility, or provider of air ambulance 

services wishes to initiate a 30-day open 

negotiation period for purposes of 

determining the amount of total 

payment, the provider, facility, or 

provider of air ambulance services may 

contact the appropriate person or office 

to initiate open negotiation, and that if 

the 30-day open negotiation period does 

not result in an agreement on the 

payment amount, generally, the 

provider, facility, or provider of air 

ambulance services may initiate the 

Federal IDR process within 4 days after 

the end of the open negotiation 

period.11 The plan or issuer must 

provide contact information, including a 

telephone number and email address, 

for the appropriate office or person for 

the provider, facility, or provider of air 

ambulance services to contact to initiate 

open negotiation for purposes of 

determining a payment amount 

(inclusive of cost sharing) for the item 

or service.12

In addition, upon request by the 

provider or facility,13 a plan or issuer 

must provide in a timely manner 

information about whether the QPA 

includes contracted rates that were not 

set on a fee-for-service basis for the 

specific items and services and whether 

the QPA for those items and services 

was determined using underlying fee 

schedule rates or a derived amount.14 If 

an eligible database was used to 

determine the QPA, upon request by the 

provider or facility, the plan or issuer 

must provide information to identify 

which database was used.15 Similarly, if 

a related service code was used to 

determine the QPA for an item or 

service billed under a new service code, 

upon request by the provider or facility 

the plan or issuer must provide 

information to identify which related 

service code was used.16

Finally, upon request by the provider 

or facility, the plan or issuer must 

provide a statement, if applicable, that 

the plan’s or issuer’s contracted rates 

include risk-sharing, bonus, penalty, or 

other incentive-based or retrospective 

payments or payment adjustments that 

were excluded for purposes of 

calculating the QPA for the items and 

services involved.17

C. October 2021 Interim Final Rules and 

Related Guidance 

The October 2021 interim final rules 

implement the Federal IDR process 

under sections 9816(c) and 9817(b) of 

the Code, sections 716(c) and 717(b) of 

ERISA, and sections 2799A–1(c) and 

2799A–2(b) of the PHS Act. The Federal 

IDR process may be used by group 

health plans and health insurance 

issuers offering group or individual 

health insurance coverage and 

nonparticipating providers, facilities, 

and providers of air ambulance services 

to determine the out-of-network rate for 

certain items and services. These are 

emergency services, non-emergency 

services furnished by nonparticipating 

providers for patient visits to certain 

participating facilities (unless an 

individual has been provided notice and 

waived the individual’s balance billing 

protections, in accordance with 45 CFR 

149.410 or 149.420, as applicable), and 

air ambulance services furnished by 

nonparticipating providers of air 

ambulance services, for situations in 

which neither an All-Payer Model 

Agreement under section 1115A of the 

Social Security Act nor a specified State 

law as defined in 26 CFR 54.9816–3T, 

29 CFR 2590.716–3, and 45 CFR 149.30 

applies. 

To implement the Federal IDR 

process, the October 2021 interim final 


lotter on DSK11XQN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75747 

18 In the case of a determination made by a 

certified IDR entity, the party that submitted the 

initial notification initiating the Federal IDR 

process may not submit a subsequent notification 

involving the same other party with respect to a 

claim for the same or similar item or service that 

was the subject of the initial notification during the 

90-calendar-day period following the determination 

(the ‘‘cooling off period’’). 

19As clarified in the July 2021 interim final rules, 

the initial payment should be an amount that the 

plan or issuer reasonably intends to be payment in 

full based on the relevant facts and circumstances, 

prior to the beginning of any open negotiations or 

initiation of the Federal IDR process. See 86 FR 

36900–36901. 

20 86 FR 55980, 55990. 

21See U.S. Department of Health and Human 

Services, U.S. Department of Labor, and U.S. 

Department of the Treasury FAQs about Affordable 

Continued 

rules include requirements governing 

the 30-business-day open negotiation 

period; the initiation of the Federal IDR 

process; the Federal IDR process 

following initiation, including the 

selection of a certified IDR entity, 

submission of offers, payment 

determinations, and written decisions; 

costs of the Federal IDR process; 

certification of IDR entities, including 

the denial or revocation of certification 

of an IDR entity; and the collection of 

information related to the Federal IDR 

process from certified IDR entities to 

satisfy reporting requirements under the 

statute. 

To be eligible for the Federal IDR 

process, the subject of the dispute must 

be a qualified IDR item or service as 

defined in 26 CFR 54.9816–8T(a)(2)(xi), 

29 CFR 2590.716–8(a)(2)(xi), and 45 

CFR 149.510(a)(2)(xi). The October 2021 

interim final rules define ‘‘qualified IDR 

item or service’’ to mean an emergency 

service furnished by a nonparticipating 

provider or nonparticipating facility 

subject to the protections of 26 CFR 

54.9816–4T, 29 CFR 2590.716–4, or 45 

CFR 149.110, for which the exception 

under 45 CFR 149.410(b) (regarding 

receipt of notice and consent to waive 

surprise billing protections) does not 

apply. A qualified IDR item or service 

may also be an item or service furnished 

by a nonparticipating provider at a 

participating health care facility subject 

to the requirements of 26 CFR 54.9816– 

5T, 29 CFR 2590.716–5, and 45 CFR 

149.120, for which the exception under 

45 CFR 149.420(c)–(i) (regarding receipt 

of notice and consent to waive surprise 

billing protections) does not apply. For 

an item or service to be considered a 

qualified IDR item or service, the 

provider, facility, or provider of air 

ambulance services or plan or issuer, as 

applicable, must submit a valid notice 

of IDR initiation through the Federal 

IDR portal for the item or service. The 

notice of IDR initiation is not valid if the 

30-business-day open negotiation period 

under 26 CFR 54.9816–8T(b)(1), 29 CFR 

2590.716–8(b)(1), and 45 CFR 

149.510(b)(1) has not elapsed or an 

agreement on the payment amount has 

been reached. The term ‘‘qualified IDR 

item or service’’ also includes air 

ambulance services furnished by 

nonparticipating providers of air 

ambulance services subject to the 

protections of 26 CFR 54.9817–1T, 29 

CFR 2590.717–1, and 45 CFR 149.130, 

as these services are defined in 26 CFR 

54.9816–3T, 29 CFR 2590.716–3, and 45 

CFR 149.30, for which the open 

negotiation period under 26 CFR 

54.9816–8T(b)(1), 29 CFR 2590.716– 

8(b)(1), and 45 CFR 149.510(b)(1) has 

elapsed, no agreement on the payment 

amount has been reached, and a valid 

notice of IDR initiation has been 

submitted after the 30-business-day 

open negotiation period has been 

satisfied. 

The term ‘‘qualified IDR item or 

service’’ does not include items and 

services for which the out-of-network 

rate is determined by an All-Payer 

Model Agreement under section 1115A 

of the Social Security Act or by 

reference to a specified State law. 

Additionally, this term does not include 

an item or service submitted by the 

initiating party that is subject to the 90- 

calendar-day suspension period (also 

referred to as the ‘‘cooling-off period’’) 

under 26 CFR 54.9816–8T(c)(4)(vii)(B), 

29 CFR 2590.716–8(c)(4)(vii)(B), and 45 

CFR 149.510(c)(4)(vii)(B) except to the 

extent that it is submitted during the 

subsequent 30-business-day period, as 

allowed under the October 2021 interim 

final rules.18

The open negotiation period may be 

initiated by either party during the 30- 

business-day period beginning on the 

day the nonparticipating provider, 

facility, or nonparticipating provider of 

air ambulance services receives either 

an initial payment or a notice of denial 

of payment for an item or service.19 In 

order for a plan, issuer, provider, 

facility, or provider of air ambulance 

services to know when it is a party to 

an open negotiation and the item or 

service for which the payment is to be 

negotiated, the party initiating the open 

negotiation period must provide written 

notice to the other party of its intent to 

negotiate using a standardized form, 

referred to as an open negotiation 

notice. The open negotiation notice 

must include information sufficient to 

identify the item or service subject to 

negotiation, including the date the item 

or service was furnished, the service 

code, the initial payment amount or 

notice of denial of payment, as 

applicable, an offer for the out-ofnetwork rate, and the contact 

information of the party sending the 

open negotiation notice. The open 

negotiation notice must be sent during 

the 30-business-day period beginning on 

the day the initial payment or notice of 

denial of payment from the plan or 

issuer regarding such item or service 

was received and must be provided in 

writing. The party sending the open 

negotiation notice may satisfy this 

requirement by providing the notice to 

the opposing party electronically (such 

as by email) if the following two 

conditions are satisfied: (1) the party 

sending the open negotiation notice has 

a good faith belief that the electronic 

method is readily accessible to the other 

party; and (2) the notice is provided in 

paper form free of charge upon request. 

The 30-business-day open negotiation 

period begins on the day on which the 

open negotiation notice is first sent by 

a party. 

As stated in the preamble to the 

October 2021 interim final rules, parties 

should be able to provide effective 

notice because the parties have already 

made initial contact (that is, the 

provider, facility, or provider of air 

ambulance services has transmitted a 

bill to the plan or issuer, and the plan 

or issuer sent an initial payment or a 

notice of denial of payment to the 

provider, facility, or provider of air 

ambulance services).20 The Departments 

encouraged the parties to take 

reasonable measures to ensure that 

actual notice is provided, such as by 

confirming that the email address is 

correct, and cautioned that if the open 

negotiation notice is not properly 

provided to the other party (and no 

reasonable measures have been taken to 

ensure actual notice has been provided), 

the Departments or a certified IDR entity 

may determine that the 30-business-day 

open negotiation period has not begun. 

In such a case, any subsequent payment 

determination from a certified IDR 

entity may be unenforceable due to the 

failure of the party sending the open 

negotiation notice to meet the open 

negotiation requirement of the October 

2021 interim final rules. In guidance, 

the Departments clarified how a 

provider, facility, or provider of air 

ambulance services should proceed if 

the plan or issuer fails to disclose 

information necessary to initiate the 

open negotiation period when providing 

the initial payment or notice of denial 

of payment and whether providers, 

facilities, or providers of air ambulance 

services are required to use a plan’s or 

issuer’s online portal to submit an open 

negotiation notice.21


lotter on DSK11XQN23PROD with PROPOSALS2
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Care Act and Consolidated Appropriations Act, 

2021 Implementation Part 55, Q20 and Q21 (Aug. 

19, 2022), available at https://www.dol.gov/sites/ 

dolgov/files/EBSA/about-ebsa/our-activities/ 

resource-center/faqs/aca-part-55.pdf and https://

www.cms.gov/files/document/faqs-part-55.pdf. 

22 86 FR 55991; 26 CFR 54.9816–8T(b)(2)(i), 29 

CFR 2590.716–8(b)(2)(i), and 45 CFR 

149.510(b)(2)(i). 

23 86 FR 55991. 

24 26 CFR 54.9816–8T(b)(2)(iii)(A), 29 CFR 

2590.716–8(b)(2)(iii)(A), and 45 CFR 

149.510(b)(2)(iii)(A). 

25 86 FR 55991. 

26 Id. 

27 86 FR 55991 through 55992, 26 CFR 54.9816– 

8T(c)(1)(i), 29 CFR 2590.716–8(c)(1)(i), and 45 CFR 

149.510(c)(1)(i). 

The October 2021 interim final rules 

provide that if the parties have not 

negotiated an agreement on the out-ofnetwork rate by the last day of the open 

negotiation period, either party may 

initiate the Federal IDR process during 

the 4-business-day period beginning on 

the 31st business day after the start of 

the open negotiation period.22 To 

initiate the Federal IDR process, the 

initiating party must submit the 

standard notice of IDR initiation to the 

other party and to the Departments. As 

stated in the preamble of the October 

2021 interim final rules, this notice 

must be provided to the Departments 

and the other party on the same day.23

The notice of IDR initiation must 

include: (1) information sufficient to 

identify the qualified IDR items and 

services (and whether the qualified IDR 

items or services are designated as 

batched items and services), including 

the furnishing date(s) and location(s) of 

the item or service, the type of qualified 

IDR item or service (such as emergency 

services, post-stabilization professional 

services, hospital-based services), 

corresponding service and place-ofservice code(s), the amount of cost 

sharing allowed, and the amount of the 

initial payment made by the plan or 

issuer for the qualified IDR item or 

service, if applicable; (2) the names and 

contact information of the parties 

involved, including email addresses, 

phone numbers, and mailing addresses; 

(3) the State where the qualified IDR 

item or service was furnished; (4) the 

commencement date of the open 

negotiation period; (5) the initiating 

party’s preferred certified IDR entity; (6) 

an attestation that the item or service is 

a qualified IDR item or service within 

the scope of the Federal IDR process; (7) 

the QPA; (8) information about the QPA 

as described in 26 CFR 54.9816–6T(d), 

29 CFR 2590.716–6(d), and 45 CFR 

149.140(d); and (9) general information 

describing the Federal IDR process as 

specified by the Departments.24 The 

general information should include a 

description of the scope of the Federal 

IDR process and key deadlines in the 

Federal IDR process, including the dates 

to initiate the Federal IDR process, how 

to select a certified IDR entity, and the 

process for selecting an offer.25 The 

Departments have developed a form that 

parties must use to satisfy this 

requirement to provide general 

information describing the Federal IDR 

process. 

Under section 9816(c)(1)(B) of the 

Code, section 716(c)(1)(B) of ERISA, and 

section 2799A–1(c)(1)(B) of the PHS 

Act, the date of initiation of the Federal 

IDR process is the date of the 

submission of the notice of IDR 

initiation or another date specified by 

the Departments that is not later than 

the date of receipt of the notice of IDR 

initiation by both the other party to the 

dispute and the Departments. The 

October 2021 interim final rules 

establish that the initiation date of the 

Federal IDR process is the date of 

receipt of the notice of IDR initiation by 

the Departments.26

Under the October 2021 interim final 

rules, the plan or issuer and the 

nonparticipating provider, 

nonparticipating emergency facility, or 

nonparticipating provider of air 

ambulance services (as applicable) may 

jointly select a certified IDR entity no 

later than 3 business days following the 

date of the IDR initiation.27 As 

previously stated, the initiating party 

will select its preferred certified IDR 

entity in the notice of IDR initiation. 

The party in receipt of the notice of IDR 

initiation (non-initiating party) may 

agree or object to the preferred certified 

IDR entity identified by the initiating 

party in the notice of IDR initiation. If 

the non-initiating party does not object 

within 3 business days of the date of 

initiation of the Federal IDR process, the 

preferred certified IDR entity identified 

in the notice of IDR initiation will be the 

selected certified IDR entity, provided 

that the certified IDR entity does not 

have a conflict of interest. If the noninitiating party objects, that party must 

timely notify the initiating party of the 

objection and propose an alternative 

preferred certified IDR entity. The 

initiating party must then agree or object 

to the alternative preferred certified IDR 

entity. If the initiating party fails to 

object to the alternative preferred 

certified IDR entity within 3 business 

days of the date of initiation of the 

Federal IDR process, the alternative 

preferred certified IDR entity proposed 

by the non-initiating party will be the 

selected certified IDR entity, provided 

that the certified IDR entity does not 

have a conflict of interest. If both parties 

agree on and select a certified IDR entity 

or fail to agree upon a certified IDR 

entity within the specified timeframe, 

the initiating party must notify the 

Departments by electronically 

submitting the notice of the certified 

IDR entity selection or failure to select 

(as applicable), no later than 1 business 

day after the end of the 3-business-day 

period (or in other words, 4 business 

days after the date of initiation of the 

Federal IDR process) through the 

Federal IDR portal. If the parties fail to 

jointly select a certified IDR entity, the 

Departments will then randomly select 

a certified IDR entity not later than 6 

business days after the date of initiation 

of the Federal IDR process and will 

notify the parties of the selection. In 

addition, in instances in which the noninitiating party believes that an item or 

service is not eligible for the Federal 

IDR process, the non-initiating party 

must notify the Departments through 

the Federal IDR portal within the same 

timeframe that the notice of certified 

IDR entity selection or failure to select 

is required (or in other words, 4 

business days after the date of initiation 

of the Federal IDR process) and provide 

information that demonstrates why an 

item or service is not eligible for the 

Federal IDR process. 

After being notified of selection 

(either by the parties or the 

Departments), certified IDR entities are 

required within 3 business days of 

selection to attest that they do not have 

a conflict of interest as specified under 

26 CFR 54.9816–8T(c)(1)(ii), 29 CFR 

2590.716–8(c)(1)(ii), and 45 CFR 

149.510(c)(1)(ii). Certified IDR entities 

are also required to review the 

information submitted in the notice of 

IDR initiation and any additional 

requested information to determine 

whether the dispute is for a qualified 

IDR item or service, as defined in 26 

CFR 54.9816–8T(a)(2)(xi), 29 CFR 

2590.716–8(a)(2)(xi), and 45 CFR 

149.510(a)(2)(xi), that is eligible for the 

Federal IDR process, including whether 

an All-Payer Model Agreement or 

specified State law applies. If an item or 

service is not a qualified IDR item or 

service eligible for the Federal IDR 

process, certified IDR entities must 

notify the Departments and the parties 

within 3 business days of making this 

determination. 

The October 2021 interim final rules 

provide that, not later than 30 business 

days after the selection of a certified IDR 

entity, the certified IDR entity must 

select one of the offers submitted by 

either party to the dispute to be the outof-network rate for the qualified IDR 


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28 26 CFR 54.9816–8T(c)(4)(ii), 29 CFR 2590.716– 

8(c)(4)(ii), and 45 CFR 149.510(c)(4)(ii). 

29 86 FR 55995. 

30 Id. 

31TMA I and TMA II. 

32 86 FR 55995, 26 CFR 54.9816–8T(c)(4)(ii), 29 

CFR 2590.716–8(c)(4)(ii), and 45 CFR 

149.510(c)(4)(ii). 

33The Federal IDR portal is available at https:// 

www.nsa-idr.cms.gov and must be used throughout 

the Federal IDR process to maximize efficiency and 

reduce burden. 

34 86 FR 55994. See also the October 2021 interim 

final rules in which the Departments defined 

‘‘batched items and services’’ as ‘‘multiple qualified 

IDR items or services that are considered jointly as 

part of one payment determination by a certified 

IDR entity for purposes of the Federal IDR process.’’ 

86 FR 55987 

35 26 CFR 54.9816–8T(d)(2)(i), 29 CFR 2590.716– 

8(d)(2)(i), and 45 CFR 149.510(d)(2)(i). 

36See Federal Independent Dispute Resolution 

(IDR) Process Guidance for Disputing Parties, 

available at: https://www.cms.gov/files/document/ 

rev-102822-idr-guidance-disputing-parties.pdf. 

37 26 CFR 54.9816–8T(e)(2)(ix), 29 CFR 2590.716– 

8(e)(2)(ix), and 45 CFR 149.510(e)(2)(ix). The No 

Surprises Act directed the Departments to jointly 

establish one Federal IDR process. To 

operationalize the Federal IDR process, HHS 

collects administrative fees for all disputes initiated 

under the Federal IDR process, including the 

administrative fees paid in connection with the 

Federal IDR process for health plans that are subject 

to the Code or ERISA. 

38 26 CFR 54.9816–8T(d)(1)(ii), 29 CFR 2590.716– 

8(d)(1)(ii), and 45 CFR 149.510(d)(1)(ii). 

39 26 CFR 54.9816–8T(d)(1)(i), 29 CFR 2590.716– 

8(d)(1)(i), and 45 CFR 149.510(d)(1)(i). 

40 26 CFR 54.9816–8T(d)(1)(ii), 29 CFR 2590.716– 

8(d)(1)(ii), and 45 CFR 149.510(d)(1)(ii). 

41 26 CFR 54.9816–8T(c)(2)(ii), 29 CFR 2590.716– 

8(c)(2)(ii), and 45 CFR 149.510(c)(2)(ii). 

42See https://www.cms.gov/cciio/resources/ 

regulations-and-guidance/downloads/patientprovider-dispute-resolution-administrative-fee-cy2023.pdf. 

item or service.28 For each qualified IDR 

item or service, the total plan or 

coverage payment is the amount by 

which this out-of-network rate exceeds 

the cost-sharing amount for the 

qualified IDR item or service (with any 

initial payment made by the plan or 

issuer counted toward the total plan or 

coverage payment). 

The October 2021 interim final rules 

also provided that, after considering the 

QPA, the statutory factors under 

sections 9816(c)(5)(C)(ii) and 

9817(b)(5)(C)(ii) of the Code, sections 

716(c)(5)(C)(ii) and 717(b)(5)(C)(ii) of 

ERISA, and sections 2799A– 

1(c)(5)(C)(ii) and 2799A–2(b)(5)(C)(ii) of 

the PHS Act, additional information 

requested by the certified IDR entity 

from the parties, and all of the 

additional credible information 

submitted by the parties that was not 

prohibited information under 26 CFR 

54.9816–8T(c)(4)(v), 29 CFR 2590.716– 

8(c)(4)(v), and 45 CFR 149.510(c)(4)(v), 

the certified IDR entity must select the 

offer closest to the QPA, unless the 

certified IDR entity determined that the 

credible information submitted by the 

parties clearly demonstrated that the 

QPA was materially different from the 

appropriate out-of-network rate, or the 

offers were equally distant from the 

QPA but in opposing directions.29 In 

those situations, the October 2021 

interim final rules required the certified 

IDR entity to select the offer that the 

certified IDR entity determined best 

represented the value of the item or 

service, which could be either party’s 

offer.30 However, as discussed in 

sections I.D. and I.F. of this preamble, 

the District Court vacated portions of 

these rules related to certified IDR entity 

determinations.31

The October 2021 interim final rules 

also provide that not later than 30 

business days after the selection of the 

certified IDR entity, the certified IDR 

entity must notify parties to the dispute 

of the selection of the offer and provide 

a written decision,32 which must be 

submitted to the parties and the 

Departments through the Federal IDR 

portal.33

Section 9816(c)(3)(A) of the Code, 

section 716(c)(3)(A) of ERISA, and 

section 2799A–1(c)(3)(A) of the PHS Act 

direct the Departments to specify 

criteria under which multiple qualified 

IDR items and services are permitted to 

be considered jointly as part of a single 

determination (‘‘batched determination’’ 

or ‘‘batched dispute’’) by a certified IDR 

entity for purposes of encouraging the 

efficiency (including minimizing costs) 

of the Federal IDR process. These 

sections further require that items and 

services may be considered as part of a 

batched determination only if the items 

and services are furnished by the same 

provider or facility; payment for the 

items and services is required to be 

made by the same group health plan or 

health insurance issuer; such items and 

services are related to the treatment of 

a similar condition; and the items and 

services were furnished during the 30- 

day period following the date on which 

the first item or service included in the 

batched determination was furnished, or 

during an alternative period as 

determined by the Departments, for use 

in limited situations, such as by the 

consent of the parties or in the case of 

low-volume items and services, to 

encourage procedural efficiency and 

minimize health plan and provider 

administrative costs. The October 2021 

interim final rules implemented these 

requirements for batched 

determinations at 26 CFR 54.9816– 

8T(c)(3)(i), 29 CFR 2590.716–8(c)(3)(i), 

and 45 CFR 149.510(c)(3)(i), which are 

subject to the certified IDR entity fee for 

batched determinations.34

The October 2021 interim final rules 

also establish requirements related to 

the costs of the Federal IDR process. 

Under the October 2021 interim final 

rules, each party must pay a nonrefundable administrative fee for 

participating in the Federal IDR 

process.35 The certified IDR entity may 

invoice the parties for the 

administrative fee at the time the 

certified IDR entity is selected, and the 

parties must pay the administrative fee 

by the time of offer submission.36 The 

administrative fee is paid by each party 

to the certified IDR entity and remitted 

to the Departments.37 Under the October 

2021 interim final rules, the 

administrative fee was to be established 

annually through guidance in a manner 

such that the total administrative fees 

collected for a year are estimated to be 

equal to the amount of expenditures 

estimated to be made by the 

Departments to carry out the Federal 

IDR process for that year. 

Additionally, under the October 2021 

interim final rules, each party must also 

pay a certified IDR entity fee to the 

certified IDR entity at the time that the 

party submits its offer.38 However, the 

non-prevailing party is ultimately 

responsible for the full certified IDR 

entity fee, which is retained by the 

certified IDR entity for the services it 

performed.39 The certified IDR entity fee 

that was paid by the prevailing party is 

returned to the prevailing party by the 

certified IDR entity within 30 business 

days following the date of the payment 

determination.40 If the parties reach an 

agreement after initiating the Federal 

IDR process but before the certified IDR 

entity makes a payment determination, 

the certified IDR entity fee is split 

evenly between the parties, unless the 

parties agree on an alternative method 

for allocating the certified IDR entity 

fee.41 Similarly, if the initiating party 

withdraws a dispute after a certified IDR 

entity has been assigned but before the 

certified IDR entity makes a payment 

determination, responsibility for the 

certified IDR entity fee is split evenly 

between the parties.42 In the case of 

batched determinations, the certified 

IDR entity may make different payment 

determinations for each qualified IDR 

item or service under dispute. In these 

cases, the party with the fewest 

determinations in its favor is considered 

the non-prevailing party and is 

responsible for the full certified IDR 

entity fee. If each party prevails in an 

equal number of determinations, the 

certified IDR entity fee is split evenly 

between the parties. Under the October 

2021 interim final rules, the 


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43Tex. Med. Ass’n, et al. v. U.S. Dep’t of Health 

and Human Servs., 587 F. Supp. 3d 528 (E.D. Tex. 

2022). 

44 Id. 

45 LifeNet, Inc. v. U.S. Dep’t of Health and Human 

Servs., 617 F.Supp.3d 547 (E.D. Tex. July 26, 2022). 

46 Id. 

47Tex. Med. Ass’n., et al. v. U.S. Dep’t of Health 

and Human Servs., Case No. 6:22–cv–00450–JDK 

(E.D. Tex. November 30, 2022). 

48See Memorandum Opinion and Order, Tex. 

Med. Ass’n., et al. v. U.S. Dep’t of Health and 

Human Servs., No. 6:22–cv–00450–JDK (E.D. Tex. 

August 24, 2023). 

49Specifically, the District Court vacated certain 

provisions of 54.9816–6T and 54.9817–1T, 29 CFR 

2590.716–6 and 2590.717–1, and 45 CFR 149.130 

and 149.140. The District Court also vacated 5 CFR 

890.114(a), insofar as it requires compliance with 

the vacated regulations and guidance. 

50Specifically, the District Court vacated FAQs 

about Affordable Care Act and Consolidated 

Appropriations Act, 2021 Implementation Part 55 

(Aug. 19, 2022), Q14 and 15, as well as portions of 

Technical Guidance for Certified IDR Entities at 2– 

3 (Aug. 18, 2022). 

51Tex. Med. Ass’n., et al. v. U.S. Dep’t of Health 

and Human Servs., Case No. 6:23–cv–00059–JDK, 

(E.D. Tex. Jan. 30, 2023). 52Centers for Medicare & Medicaid Services (Dec. 

23, 2022). Amendment to the Calendar Year 2023 

Fee Guidance for the Federal Independent Dispute 

Resolution Process Under the No Surprises Act: 

Change in Administrative Fee. https://

www.cms.gov/cciio/resources/regulations-andguidance/downloads/amended-cy2023-feeguidance-federal-independent-dispute-resolutionprocess-nsa.pdf. 

53See Motion for Summary Judgment and Reply 

in Support of Summary Judgment, p. 1, Tex. Med. 

Ass’n., et al. v. U.S. Dep’t of Health and Human 

Servs., No. 6:23–cv–00059–JDK (E.D. Tex. March 

27, 2023). 

54See Memorandum Opinion and Order, Tex. 

Med. Ass’n. v. U.S. Dep’t of Health and Hum. Servs, 

No. 6:23–cv–00059–JDK (E.D. Tex. August 3, 2023). 

55Specifically, the District Court vacated the 

requirement under 26 CFR 54.9816–8T(c)(3)(i)(C), 

29 CFR 2590.716–8(c)(3)(i)(C), and 45 CFR 

149.510(c)(3)(i)(C) that for a qualified IDR item and 

service to be considered the same or similar item 

and service, it must be billed under the same 

service code or a comparable code under a different 

procedural code system, such as the Current 

Procedural Terminology (CPT) codes with 

modifiers, if applicable, Healthcare Common 

Procedure Coding System (HCPCS) with modifiers, 

if applicable, or Diagnosis-Related Group (DRG) 

codes with modifiers, if applicable. 

Departments set certified IDR entity fee 

ranges annually through guidance. 

D. Litigation Regarding the July 2021 

and October 2021 Interim Final Rules 

and Related Guidance 

On October 28, 2021, the Texas 

Medical Association, a trade association 

representing physicians, and a Texas 

physician filed a lawsuit against the 

Departments and OPM (TMA I),43 stating 

that certain provisions of the October 

2021 interim final rules relating to the 

certified IDR entities’ consideration of 

the QPA, as well as additional factors 

related to items and services that are not 

air ambulance services, should be 

vacated. Plaintiffs argued that the 

October 2021 interim final rules ignored 

Congress’s intent that certified IDR 

entities weigh the QPA and other factors 

without favoring any factor, and the 

plaintiffs stated that as a result, the rules 

would skew IDR results in favor of plans 

and issuers. On February 23, 2022, the 

District Court issued a memorandum 

opinion and order that vacated portions 

of the October 2021 interim final rules 

governing aspects of the Federal IDR 

process related to non-air ambulance 

qualified IDR items or services 

including: (1) the definition of ‘‘material 

difference’’; (2) the requirement that a 

certified IDR entity must select the offer 

closest to the QPA unless the certified 

IDR entity determines that credible 

information submitted by either party 

under 26 CFR 54.9816–8T(c)(4)(i), 29 

CFR 2590.716–8(c)(4)(i), and 45 CFR 

149.510(c)(4)(i) clearly demonstrates 

that the QPA is materially different from 

the appropriate out-of-network rate for 

non-air ambulance qualified IDR items 

or services, or if the offers are equally 

distant from the QPA but in opposing 

directions; (3) the requirement that the 

certified IDR entity may only consider 

the additional information submitted by 

either party to the extent that the 

credible information related to the 

circumstances under 26 CFR 54.9816– 

8T(c)(4)(i), 29 CFR 2590.716–8(c)(4)(i), 

and 45 CFR 149.510(c)(4)(i) clearly 

demonstrates that the QPA is materially 

different from the appropriate out-ofnetwork rate for non-air ambulance 

qualified IDR items or services; (4) the 

dispute resolution examples; and (5) the 

requirement that, if the certified IDR 

entity does not choose the offer closest 

to the QPA, the certified IDR entity’s 

written decision must include an 

explanation of the credible information 

that the certified IDR entity determined 

demonstrated that the QPA was 

materially different from the appropriate 

out-of-network rate, based on the factors 

certified IDR entities are permitted to 

consider for the qualified IDR item or 

service.44

On April 27, 2022, LifeNet, Inc., a 

provider of air ambulance services, filed 

a lawsuit against the Departments and 

OPM (LifeNet) 45 seeking the vacatur of 

additional provisions of the October 

2021 interim final rules applicable to air 

ambulance services. In particular, 

LifeNet alleged that the requirement 

codified in the last sentence of 26 CFR 

54.9817–2T(b)(2), 29 CFR 2590.717– 

2(b)(2), and 45 CFR 149.520(b)(2), which 

specifies the certified IDR entity may 

consider information submitted by a 

party only if the information ‘‘clearly 

demonstrate[s] that the qualifying 

payment amount is materially different 

from the appropriate out-of-network 

rate,’’ should be vacated. On July 26, 

2022, the District Court issued a 

memorandum opinion and order 

vacating this language.46

On November 30, 2022, the Texas 

Medical Association, Tyler Regional 

Hospital, and a Texas physician filed a 

lawsuit (TMA III) 47 against the 

Departments and OPM, asserting that 

the July 2021 interim final rules, 

including the provisions of the 

regulations governing the methodology 

for calculating the QPA, and certain 

related guidance documents were in 

conflict with the statutory language. On 

August 24, 2023, the District Court 

issued a memorandum opinion and 

order 48 that vacated certain portions of 

the July 2021 interim final rules and 

associated regulatory provisions 49 and 

portions of guidance documents,50

including portions related to the 

methodology for calculating the QPA 

and interpretations for certified IDR 

entities related to the processing of 

disputes for air ambulance services. 

On January 30, 2023, the Texas 

Medical Association, Houston 

Radiology Associated, Texas 

Radiological Society, Tyler Regional 

Hospital, and a Texas physician filed a 

lawsuit (TMA IV) 51 against the 

Departments and OPM, asserting that 

the December 2022 fee guidance 52 and 

the October 2021 interim final rules 

were unlawfully issued without notice 

and comment rulemaking and were 

arbitrary and capricious.53 On August 3, 

2023, the District Court issued a 

memorandum opinion and order 54 that 

vacated the portion of the December 

2022 fee guidance increasing the 

administrative fee for the Federal IDR 

process to $350 per party for disputes 

initiated during the calendar year 

beginning January 1, 2023. The District 

Court also vacated certain provisions of 

the October 2021 interim final rules 

setting forth the batching criteria under 

which multiple IDR items or services 

are treated as related to the ‘‘treatment 

of a similar condition.’’ 55 In light of the 

TMA IV order, on August 3, 2023, the 

Departments instructed certified IDR 

entities to pause all work in the Federal 

IDR portal until the Departments 

updated Federal IDR process guidance, 

systems, and related documents to make 

them consistent with the TMA IV order. 

Subsequently, on August 7, 2023, the 

Departments directed certified IDR 

entities to resume processing all single 

and bundled disputes for which the 

administrative fee had already been 

paid and all batched disputes for which 

the certified IDR entity had already 

determined the dispute eligible and 


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56For the purposes of the Federal IDR process, 

the Departments in guidance interpreted a bundled 

payment arrangement to be an arrangement under 

which: (1) a provider, facility, or provider of air 

ambulance services bills for multiple items or 

services under a single service code; or (2) a plan 

or issuer makes an initial payment or denial of 

payment to a provider, facility, or provider of air 

ambulance services under a single service code that 

represents multiple items or services (e.g., a DRG). 

See U.S. Department of Health and Human 

Services, U.S. Department of Labor, and U.S. 

Department of Treasury, Federal Independent 

Dispute Resolution (IDR) Process Technical 

Assistance for Certified IDR Entities, August 2022, 

available at https://www.cms.gov/files/document/ 

TA-certified-independent-dispute-resolutionentities-August-2022.pdf. These rules, discussed in 

section II.A. of this preamble, propose to codify that 

definition in the regulations. 

57Centers for Medicare & Medicaid Services (Aug. 

11, 2023). Federal Independent Dispute Resolution 

(IDR) Process Administrative Fee FAQs. https://

www.cms.gov/cciio/resources/regulations-andguidance/downloads/no-surprises-act-independentdispute-resolution-administrative-fee-frequentlyasked-questions.pdf. 

58See U.S. Department of Health and Human 

Services, U.S. Department of Labor, U.S. 

Department of the Treasury, Office of Personnel 

Management, FAQs about Consolidated 

Appropriations Act, 2021 Implementation Part 62 

(Oct. 6, 2023), available at https://www.dol.gov/ 

sites/dolgov/files/EBSA/about-ebsa/our-activities/ 

resource-center/faqs/aca-part-62.pdf and https://

www.cms.gov/files/document/faqs-part-62.pdf. 

59 87 FR 52622. 

60 87 FR 52622–52623. 

61 87 FR 52628. 62 87 FR 52626. 

administrative fees had been paid (or 

the deadline for collecting fees had 

expired) before August 3, 2023.56 On 

August 8, 2023, the Departments 

directed certified IDR entities to resume 

processing single and bundled disputes 

initiated in 2022 for which the 

administrative fee had not been paid 

before August 3, 2023. On August 11, 

2023, the Departments released 

guidance to reflect the TMA IV order 

related to the administrative fee and to 

clarify the administrative fee amount for 

2023.57 On the same date, the 

Departments directed certified IDR 

entities to resume processing single and 

bundled disputes initiated in 2023 for 

which the administrative fees had not 

been paid before August 3, 2023. 

As a result of the TMA III order issued 

on August 24, 2023, the Departments 

again paused all IDR-related activities in 

order to evaluate the District Court’s 

order and review current Federal IDR 

processes, templates, and system 

functions necessary to comply with the 

order. On September 5, 2023, the 

Departments directed certified IDR 

entities to resume making eligibility and 

conflict-of-interest determinations for 

all single and bundled disputes 

submitted on or before August 3, 2023, 

and encouraged disputing parties to 

continue engaging in open negotiations. 

On September 21, 2023, the 

Departments directed certified IDR 

entities to resume processing all single 

and bundled disputes submitted on or 

before August 3, 2023. On October 6, 

2023, the Departments and OPM 

released ‘‘FAQs About Consolidated 

Appropriations Act, 2021 

Implementation Part 62’’ 58 to provide 

guidance in light of the TMA III order. 

On the same day, the Departments 

reopened the Federal IDR portal for the 

initiation of certain new single and 

bundled disputes. At the time of this 

proposed rulemaking and in accordance 

with the TMA III and TMA IV orders, 

the Departments plan to release 

guidance to clarify how certified IDR 

entities should determine whether a 

dispute is appropriately batched. 

E. August 2022 Final Rules 

The August 2022 final rules included 

amendments to remove from the 

regulations the language vacated by the 

District Court in TMA I and LifeNet,59 as 

described in section I.D. of this 

preamble. In addition, the August 2022 

final rules amended and finalized 

certain disclosure requirements related 

to information that plans and issuers 

must share about the QPA under the 

July 2021 interim final rules.60 The 

August 2022 final rules also amended 

and finalized select provisions of the 

October 2021 interim final rules on the 

information to be considered by a 

certified IDR entity when it makes a 

payment determination under the 

Federal IDR process.61

Specifically, the Departments 

amended and finalized parts of the July 

2021 and October 2021 interim final 

rules related to: (1) the information that 

must be disclosed about the QPA under 

26 CFR 54.9816–6T(d), 29 CFR 

2590.716–6(d), and 45 CFR 149.140(d) 

to address downcoding; (2) the certified 

IDR entity’s consideration of the 

statutory factors when making a 

payment determination under the 

Federal IDR process at 26 CFR 54.9816– 

8T(c)(4)(iii)–(iv) and 54.9817–2T(b)(2), 

29 CFR 2590.716–8(c)(4)(iii)–(iv) and 

2590.717–2(b)(2), and 45 CFR 

149.510(c)(4)(iii)–(iv) and 149.520(b)(2); 

and (3) the certified IDR entity’s written 

decision at 26 CFR 54.9816– 

8T(c)(4)(vi)(B), 29 CFR 2590.716– 

8(c)(4)(vi)(B), and 45 CFR 

149.510(c)(4)(vi)(B). 

For the information that must be 

disclosed with the QPA, the August 

2022 final rules require that if a QPA is 

based on a downcoded service code or 

modifier, in addition to the information 

already required to be provided with an 

initial payment or notice of denial of 

payment, a plan or issuer must provide 

a statement that the service code or 

modifier billed by the provider, facility, 

or provider of air ambulance services 

was downcoded; an explanation of why 

the claim was downcoded, including a 

description of which service codes were 

altered, if any, and which modifiers 

were altered, added, or removed, if any; 

and the amount that would have been 

the QPA had the service code or 

modifier not been downcoded. The 

August 2022 final rules define the term 

‘‘downcode,’’ as described in the 

preamble to the October 2021 interim 

final rules, to mean the alteration by a 

plan or issuer of a service code to 

another service code, or the alteration, 

addition, or removal by a plan or issuer 

of a modifier, if the changed code or 

modifier is associated with a lower QPA 

than the service code or modifier billed 

by the provider, facility, or provider of 

air ambulance services.62

The August 2022 final rules also 

provided that in determining which 

offer to select during the Federal IDR 

process, the certified IDR entity must 

consider the QPA for the applicable year 

for the same or similar item or service 

and then must consider all additional 

information submitted by a party to 

determine which offer best reflects the 

appropriate out-of-network rate, 

provided that the information relates to 

the party’s offer for the payment amount 

for the qualified IDR item or service that 

is the subject of the payment 

determination and does not include 

information that the certified IDR entity 

is prohibited from considering in 

making the payment determination 

under section 9816(c)(5)(D) of the Code, 

section 716(c)(5)(D) of ERISA, and 

section 2799A–1(c)(5)(D) of the PHS 

Act. For this purpose, the preamble to 

the August 2022 final rules stated that 

information requested by a certified IDR 

entity, or submitted by a party, would 

be information relating to a party’s offer 

if it tends to show that the offer best 

represents the value of the item or 

service under dispute. The August 2022 

final rules required the certified IDR 

entity to evaluate whether the 

information relates to the offer 

submitted by either party for the 

payment amount for the qualified IDR 

item or service that is the subject of the 

payment determination. The August 

2022 final rules clarified that in 

considering this additional information, 

the certified IDR entity should evaluate 

whether the information that is offered 

is credible and should not give weight 

to information that is not credible. The 

appropriate out-of-network rate must be 

the offer that the certified IDR entity 


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63Tex. Med. Ass’n, et. al. v. U.S. Dep’t of Health 

and Human Servs., Case No. 6:22–cv–372 (E.D. Tex. 

February 06, 2023) (TMA II). Air Methods 

Corporation, Rocky Mountain Holdings, LLC, and 

East Texas Air One, LLC are providers of air 

ambulance services. 

64Centers for Medicare & Medicaid Services. 

(February 10, 2023). Payment Disputes Between 

Providers and Health Plans, Notices. https://

www.cms.gov/nosurprises/help-resolve-paymentdisputes/payment-disputes-between-providers-andhealth-plans. 

65Centers for Medicare & Medicaid Services. 

(February 27, 2023). Payment Disputes Between 

Providers and Health Plans, Notices. https://

www.cms.gov/nosurprises/help-resolve-paymentdisputes/payment-disputes-between-providers-andhealth-plans. 

66Centers for Medicare & Medicaid Services. 

(March 2023). Federal Independent Dispute 

Resolution (IDR) Process for Certified IDR Entities 

(Revised). https://www.cms.gov/files/document/ 

federal-idr-guidance-idr-entities-march-2023.pdf 

and Federal Independent Dispute Resolution (IDR) 

Process for Disputing Parties (Revised). https://

www.cms.gov/files/document/federal-idr-guidancedisputing-parties-march-2023.pdf. 

determines best represents the value of 

the qualified IDR item or service. 

Additionally, the August 2022 final 

rules provided that when considering 

the additional information under 26 

CFR 54.9816–8(c)(4)(iii), 29 CFR 

2590.716–8(c)(4)(iii), and 45 CFR 

149.510(c)(4)(iii), the certified IDR 

entity should evaluate the information 

and should not give weight to that 

information if it is already accounted for 

by any of the other information 

submitted by the parties, to avoid 

weighting the same information twice. 

For the written decision, the August 

2022 final rules require the certified IDR 

entity to include what information the 

certified IDR entity used to determine 

that the offer selected as the out-ofnetwork rate is the offer that best 

represents the value of the qualified IDR 

item or service, including the weight 

given to the QPA and any additional 

credible information submitted in 

accordance with the rules. The August 

2022 final rules required that if the 

certified IDR entity relied on additional 

information in selecting an offer, its 

written decision must include an 

explanation of why the certified IDR 

entity concluded that this information 

was not already reflected in the QPA. 

F. Litigation Regarding the August 2022 

Final Rules 

On September 22, 2022, the Texas 

Medical Association, Tyler Regional 

Hospital, a Texas physician, LifeNet, 

Inc., Air Methods Corporation, Rocky 

Mountain Holdings, LLC, and East 

Texas Air One, LLC filed a lawsuit 

against the Departments (TMA II),63

asserting that certain provisions of the 

August 2022 final rules relating to the 

certified IDR entities’ consideration of 

the QPA, as well as additional factors, 

should be vacated. Plaintiffs argued that 

the August 2022 final rules unlawfully 

conflict with the No Surprises Act in the 

same manner as the vacated provisions 

of the October 2021 interim final rules— 

that is, such rules improperly restrict 

arbitrators’ discretion and unlawfully 

tilt the arbitration process in favor of the 

QPA. On February 6, 2023, the District 

Court issued a memorandum opinion 

and order that vacated portions of the 

August 2022 final rules related to the 

certified IDR entity’s consideration of 

the statutory factors when making a 

payment determination under the 

Federal IDR process at 26 CFR 54.9816– 

8(c)(4)(iii)–(iv) and 54.9817–2(b)(3), 29 

CFR 2590.716–8(c)(4)(iii)–(iv) and 

2590.717–2(b)(3), and 45 CFR 

149.510(c)(4)(iii)–(iv) and 149.520(b)(3) 

and part of the provision related to the 

certified IDR entity’s written decision at 

26 CFR 54.9816–8(c)(4)(vi)(B), 29 CFR 

2590.716–8(c)(4)(vi)(B), and 45 CFR 

149.510(c)(4)(vi)(B). The vacated 

portions of the rules include: (1) the 

requirement that certified IDR entities 

consider the QPA and then the 

additional statutory factors under 26 

CFR 54.9816–8(c)(4)(iii)(B)(1)–(5) and 

54.9817–2(b)(3), 29 CFR 2590.716– 

8(c)(4)(iii)(B)(1)–(5) and 2590.717– 

2(b)(3), and 45 CFR 

149.510(c)(4)(iii)(B)(1)–(5) and 

149.520(b)(3); (2) the provision that a 

certified IDR entity should evaluate 

whether the information submitted 

under 26 CFR 54.9816–8(c)(4)(iii)(B)–(D) 

and 54.9817–2(b)(3), 29 CFR 2590.716– 

8(c)(4)(iii)(B)–(D) and 2590.717–2(b)(3), 

and 45 CFR 149.510(c)(4)(iii)(B)–(D) and 

149.520(b)(3) is credible and relates to 

the offer submitted by either party for 

the payment amount for the qualified 

IDR item or service that is the subject of 

the payment determination, and the 

certified IDR entity should not give 

weight to information to the extent it is 

not credible, it does not relate to either 

party’s offer for the payment amount for 

the qualified IDR item or service, or it 

is already accounted for by the QPA or 

another factor; (3) the dispute resolution 

examples; and (4) the requirement that, 

if the certified IDR entity relies on 

additional information in selecting an 

offer, its written decision must include 

an explanation of why the certified IDR 

entity concluded that this information 

was not already reflected in the QPA. 

As a result of the TMA II order, on 

February 10, 2023, the Departments 

instructed certified IDR entities to hold 

all payment determinations until the 

Departments updated Federal IDR 

process guidance, systems, and related 

documents to make them consistent 

with the TMA II order.64 Subsequently, 

the Departments directed certified IDR 

entities to resume making payment 

determinations on February 27, 2023, 

for disputes involving an item or service 

furnished before October 25, 2022 (the 

effective date of the August 2022 Final 

Rules).65 On March 17, 2023, the 

Departments released updated 

guidance 66 to reflect the TMA II order 

and directed certified IDR entities to 

resume making payment determinations 

in accordance with the guidance for 

disputes involving items or services 

furnished on or after October 25, 2022. 

On April 6, 2023, the Departments 

filed a notice of appeal to the United 

States Court of Appeals for the Fifth 

Circuit from the District Court’s order 

granting summary judgement to the 

plaintiffs and denying summary 

judgment to the Departments. 

G. Federal IDR Process Administrative 

Fee and Certified IDR Entity Fee Ranges 

2023 Proposed Rules 

In light of TMA IV and to promote 

transparency in the administrative fee 

calculation, the Departments published 

the IDR Process Fees proposed rules on 

September 26, 2023. The IDR Process 

Fees proposed rules propose to amend 

the October 2021 interim final rules to 

provide that the administrative fee 

would be set in notice and comment 

rulemaking rather than annual 

guidance, propose an administrative fee 

amount that, if finalized, would apply 

for disputes initiated on or after the later 

of the effective date of the IDR Process 

Fees proposed rules or January 1, 2024, 

and propose a methodology that the 

Departments would use to calculate the 

administrative fee in the future. 

Additionally, the IDR Process Fees 

proposed rules would propose to amend 

the October 2021 interim final rules to 

provide that the certified IDR entity fee 

ranges for single and batched 

determinations would be set in notice 

and comment rulemaking rather than 

annual guidance, propose the certified 

IDR entity fee ranges for single and 

batched determinations, including a 

fixed tiered fee for batched disputes, 

and propose the considerations that the 

Departments would use to calculate the 

certified IDR entity fee ranges in the 

future. If finalized, the proposed 

certified IDR entity fee ranges and fixed 

tiered fees would apply for disputes 

initiated on or after the later of the 

effective date of the IDR Process Fees 

proposed rules or January 1, 2024. If 

finalized, the proposed administrative 

fee and certified IDR entity fee ranges 

would remain in effect until changed by 

subsequent rulemaking. 


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67Federal Independent Dispute Resolution 

Process—Status update. Available at: https://

www.cms.gov/files/document/federal-idrprocessstatus-update-april-2023.pdf. 

68 In the regulatory impact analysis of the October 

2021 interim final rules, the Departments estimated 

that 17,333 disputes involving non-air ambulance 

services and 4,899 disputes involving air 

ambulance services would be submitted to the 

Federal IDR process during the first year of 

implementation. 

69https://www.cms.gov/nosurprises/help-resolvepayment-disputes/certified-idre-list. 

70For purposes of these proposed rules, unless 

otherwise stated, whenever the Departments are 

referring to providers, facilities, and providers of air 

ambulance services, the Departments are referring 

to nonparticipating providers, facilities, and 

providers of air ambulance services. 

71 26 CFR 54.9816–8T(a)(2)(xi), 29 CFR 2590.716– 

8(a)(2)(xi), and 45 CFR 149.510 (a)(2)(xi). 

72 26 CFR 54.9816–8T(c)(3)(i)(B), 29 CFR 

2590.716–8(c)(3)(i)(B), and 45 CFR 

149.510(c)(3)(i)(B). 

73 26 CFR 54.9816–8T(c)(3)(ii), 29 CFR 2590.716– 

8(c)(3)(ii), and 45 CFR 149.510(c)(3)(ii). 

H. The Federal IDR Process to Date 

On April 15, 2022, the Departments 

launched the Federal IDR portal to 

accept disputes regarding the 

appropriate out-of-network rate for 

claims subject to the surprise billing 

protections of the No Surprises Act. 

From April 15, 2022 to July 1, 2023, 

disputing parties submitted over 

489,000 disputes. In the first year of 

operations, disputing parties submitted 

14 times the number of disputes that the 

Departments had expected to receive in 

an entire calendar year.67 68 Due to this 

unexpectedly high volume, the limited 

number of certified IDR entities,69 the 

complexity of determining disputes’ 

eligibility for the Federal IDR process, 

and a large number of ineligible 

disputes submitted, it is taking certified 

IDR entities longer than the timeframes 

established under the No Surprises Act 

and the October 2021 interim final rules 

to process payment disputes. Further, 

the District Court’s successive orders 

have resulted in multiple temporary 

closures of the Federal IDR portal, 

requiring the Departments to alter 

guidance, implement significant system 

updates, and communicate changes to 

disputing parties and certified IDR 

entities to comply with the orders. 

These interruptions to the Federal IDR 

process have exacerbated delays and 

required certified IDR entities and 

disputing parties to rapidly adjust to 

changing operations and guidance. 

Accordingly, a large number of disputes 

still await payment determinations. 

Several factors are likely contributing 

to the high volume of initiated disputes. 

First, providers, facilities, and providers 

of air ambulance services 70 have alleged 

that plans’ and issuers’ QPA 

calculations are sometimes artificially 

low and are even at times lower than 

Medicare rates. Providers, facilities, and 

providers of air ambulance services 

further allege that plans and issuers are 

making initial payments based on these 

artificially low QPAs, which 

incentivizes providers, facilities, and 

providers of air ambulance services to 

use the Federal IDR process for a larger 

number of items and services than they 

otherwise would. 

A second factor contributing to the 

high volume of disputes is that the 

disputing parties are not yet able to 

predict how disputes will be resolved 

by certified IDR entities. As the 

Departments stated in the preamble to 

the October 2021 interim final rules, a 

Federal IDR process with predictable 

outcomes will reduce the use of the 

Federal IDR process over time because, 

if outcomes are predictable in advance, 

parties will generally prefer to reach an 

agreement in line with the predicted 

outcome outside of the Federal IDR 

process to avoid the administrative costs 

of utilizing the process. 

Third, disputing parties are failing to 

engage in meaningful open negotiations. 

Parties representing providers, facilities, 

providers of air ambulance services, 

plans, and issuers have all asserted that 

they experience challenges in 

negotiating with other parties during the 

30-business-day open negotiation 

period, resulting in low levels of 

engagement during open negotiation. 

This lack of engagement has resulted in 

relatively few disputes being settled 

outside of the Federal IDR process, 

contributing to a higher-than-expected 

volume of disputes being initiated in the 

Federal IDR process. As discussed later 

in this section, interested parties also 

shared that the lack of meaningful 

engagement in open negotiation 

contributes to inefficiencies within the 

Federal IDR process, because disputing 

parties that fail to engage in open 

negotiation may not exchange 

information that would facilitate the 

Federal IDR process, such as contact 

information and other required 

disclosures, or may exchange only 

incomplete information. 

Fourth, the District Court’s successive 

rulings have necessitated multiple 

temporary shutdowns of the Federal IDR 

process to comply with the District 

Court’s orders. Each shutdown has 

halted parts, or all, of the Federal IDR 

process, interrupting the advancement 

of ongoing disputes through the process 

and preventing new disputes from being 

submitted. Reopening the Federal IDR 

portal each time has required the 

Departments to draft new guidance, 

engage in new rulemaking, implement 

significant system updates, and 

communicate changes to disputing 

parties and certified IDR entities. These 

interruptions to the Federal IDR process 

have exacerbated delays and required 

certified IDR entities and disputing 

parties to rapidly adjust to changing 

operations and guidance, which causes 

confusion regarding the current state of 

the process while certified IDR entities 

and disputing parties adapt to new or 

different processes, such as those 

discussed in section I.D. of this 

preamble related to the TMA III order. 

Finally, initiating parties are 

submitting a large number of disputes 

that are not eligible for the Federal IDR 

process, leading to both a high volume 

of dispute submissions and slow 

processing of disputes. Certified IDR 

entities have indicated to the 

Departments that determining the 

eligibility of disputes for the Federal 

IDR process is more time-consuming 

and burdensome than they expected. In 

fact, certified IDR entities report 

spending 50 to 80 percent of their time 

working on eligibility determinations. 

From April 15, 2022 to July 1, 2023, 

non-initiating parties challenged the 

eligibility of 190,465 disputes for the 

Federal IDR process, and certified IDR 

entities found 59,604 disputes 

ineligible. A dispute is not eligible for 

the Federal IDR process unless it 

concerns an item or service that meets 

the definition of a qualified IDR item or 

service.71 Ineligible disputes often 

involve an item or service that is not a 

qualified IDR item or service because it 

is covered by a health plan or coverage 

that is not subject to the surprise billing 

protections of the No Surprises Act, 

such as Medicare or Medicaid, or 

because the item or service is subject to 

a specified State law or an All-Payer 

Model Agreement. Additionally, many 

batched disputes were found ineligible 

due to the initiating party incorrectly 

batching items or services in a manner 

that did not comply with the 

regulations, such as batching claims 

paid by different plans or issuers.72

Certified IDR entities have similarly 

reported encountering incorrectly 

bundled disputes for which providers 

are attempting to submit, for example, 

an emergency room facility code as a 

bundled code with various item and 

service codes included as line items, 

rather than properly submitting a single 

service code (for example, a DiagnosisRelated Group (DRG) code under which 

a provider, facility, or provider of air 

ambulance services can bill for multiple 

items or services).73 Disputes are also 

ineligible when the disputing parties 

have failed to satisfy the 30-businessday open negotiation period 

requirements specified under 26 CFR 


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74The July 2021 interim final rules allow selfinsured group health plans, including self-insured 

non-Federal governmental plans, to voluntarily opt 

in to a State law that provides for a method for 

determining the total amount payable under such 

a plan, where a State has chosen to expand access 

to such plans, to satisfy their obligations under 

section 9816(a)–(d) of the Code, section 716(a)–(d) 

of ERISA, and section 2799A–1(a)–(d) of the PHS 

Act. A self-insured plan that has chosen to opt-in 

to a State law must prominently display in its plan 

materials describing the coverage of out-of-network 

services a statement that the plan has opted in to 

a specified State law, identify the relevant State (or 

States), and include a general description of the 

items and services provided by nonparticipating 

facilities, providers, and providers of air ambulance 

services that are covered by the specified State law. 

75U.S. Department of Health and Human 

Services, U.S. Department of Labor, and U.S. 

Department of the Treasury, Federal Independent 

Dispute Resolution (IDR) Process Technical 

Assistance for Certified IDR Entities, August 2022, 

available at https://www.cms.gov/files/document/ 

TA-certified-independent-dispute-resolutionentities-August-2022.pdf. 

54.9816–8T(b)(1), 29 CFR 2590.716– 

8(b)(1), and 45 CFR 149.510(b)(1) or 

have failed to initiate the Federal IDR 

process within 4 business days after the 

end of the 30-business-day open 

negotiation period as specified under 26 

CFR 54.9816–8T(b)(2)(i), 29 CFR 

2590.716–8(b)(2)(i), and 45 CFR 

149.510(b)(2)(i). 

The Departments’ review of the 

disputes submitted to date and feedback 

received from interested parties and 

certified IDR entities via letters, email 

communication and listening sessions 

shows a pattern of initiating parties 

submitting ineligible disputes to the 

Federal IDR process due to 

miscommunication or a lack of 

communication between the disputing 

parties. The Departments intended that 

sufficient information would be 

communicated through the disclosures 

that plans and issuers are required to 

provide with their initial payment or 

notice of denial of payment or would be 

subsequently communicated during the 

required 30-business-day open 

negotiation period to identify whether 

the item(s) or service(s) involved in the 

dispute is a qualified IDR item(s) or 

service(s). Plans and issuers assert that 

providers, facilities, and providers of air 

ambulance services submit 

overwhelming numbers of ineligible 

disputes that overload the plans’ and 

issuers’ ability to identify and respond 

to dispute initiations, while providers, 

facilities, and providers of air 

ambulance services assert that plans and 

issuers do not provide required contact 

information and disclosures in a clear 

and convenient manner and fail to 

respond to their notices initiating open 

negotiation. 

Although plans and issuers are 

required to provide disclosures with the 

initial payment or notice of denial of 

payment containing information related 

to the QPA and contact information to 

initiate open negotiations, providers, 

facilities, and providers of air 

ambulance services have reported 

difficulty locating this information. The 

inability of providers, facilities, and 

providers of air ambulance services to 

locate required disclosures has led to 

confusion about how they should 

contact and engage in open negotiations 

with the plan or issuer and ultimately 

submit the dispute to the Federal IDR 

process. If disputing parties fail to share 

the required information, or if they 

provide inaccurate information, 

certified IDR entities will have 

incomplete or inaccurate information 

when making eligibility determinations. 

As a result, certified IDR entities must 

dedicate additional resources and 

conduct outreach to determine 

eligibility. Many interested parties have 

stated that the exchange of key 

information in a more standardized 

fashion, such as through the inclusion 

of the information on electronic 

remittance advice (ERA) transactions, 

discussed in greater detail in section 

II.B. of this preamble, would ensure that 

disputing parties have timely access to 

complete and accurate information and 

therefore help reduce the number of 

ineligible disputes submitted to the 

Federal IDR process. This is primarily 

because disputing parties would have 

timely access to the information they 

need to determine whether (1) an item 

or service is a qualified IDR item or 

service and (2) it is in their interest to 

initiate the Federal IDR process 

regarding such item or service. The 

Departments are of the view that timely 

access to that type of information would 

help reduce the overall number of 

ineligible disputes, resulting in more 

manageable workloads for certified IDR 

entities and more efficient dispute 

processing overall. 

Additionally, providers and facilities 

have raised concerns that the existing 

disclosure rules do not require plans 

and issuers to provide information 

necessary for determining whether the 

item or service is subject to a specified 

State law, an All-Payer Model 

Agreement, or the Federal IDR process 

for determining the out-of-network rate. 

In particular, providers, facilities, and 

providers of air ambulance services 

have identified significant challenges in 

determining whether a claim involves a 

plan that is a self-insured group health 

plan subject to ERISA (and, if the claim 

involves an item or service covered by 

the No Surprises Act, is therefore 

generally subject to the Federal IDR 

process) or a fully-insured plan to 

which a specified State law or All-Payer 

Model Agreement may apply.74 The 

Departments also are aware that there 

are further challenges in identifying 

whether a plan subject to ERISA has 

opted into a specified State law and, 

separately, whether a specific item or 

service, or specific provider, facility, or 

provider of air ambulance services, is 

subject to a given specified State law or 

All-Payer Model Agreement. 

Additionally, providers, facilities, and 

providers of air ambulance services 

have identified difficulties in 

determining the correct legal business 

name of the plan or issuer. As a result, 

when initiating the Federal IDR process, 

providers, facilities, and providers of air 

ambulance services may initiate their 

dispute against the wrong party or may 

incorrectly batch claims that were paid 

by different plans or issuers. 

To address the high volume of 

disputes submitted to the Federal IDR 

process and the growing backlog of 

cases, the Departments have provided 

ongoing technical assistance to certified 

IDR entities and disputing parties by 

issuing guidance as well as performing 

research and outreach on dispute 

eligibility determinations.75 In addition, 

the Departments have implemented 

Federal IDR portal system 

enhancements. These system 

enhancements, such as enabling noninitiating parties to submit supporting 

documentation to contest dispute 

eligibility within their response to the 

notice of IDR initiation, allow the 

Departments to collect information 

regarding dispute eligibility earlier in 

the process to identify whether the 

eligibility requirements are met. 

However, despite the efforts to date, the 

Departments and certified IDR entities 

continue to experience challenges 

related to determining eligibility for the 

Federal IDR process, such as delays due 

to necessary outreach by the certified 

IDR entities to the disputing parties to 

obtain or verify information regarding 

the eligibility of a dispute. 

I. Scope and Purpose of Rulemaking 

This proposed rulemaking is intended 

to address specific issues that are 

critical to ensuring the timely rendering 

of payment determinations and to 

address feedback from interested parties 

and certified IDR entities to improve the 

functioning of the Federal IDR process. 

These proposed rules are intended to 

address some of the common 

communication issues between 

disputing parties, including those 

stemming from a lack of clarity as to 

whether items and services are qualified 

IDR items and services covered by the 


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Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75755 

76Section 9816(c)(4)(F) of the Code, section 

716(c)(4)(F) of ERISA, and section 2799A–1(c)(4)(F) 

of the PHS Act. 

No Surprises Act. These proposed rules 

would impose requirements and create 

incentives for parties to engage with one 

another during the open negotiation 

period, which would help reduce the 

volume of ineligible disputes being 

submitted. Specifically, these proposed 

rules would make changes to the 

information that plans, issuers, 

providers, facilities, and providers of air 

ambulance services must share before 

initiating the Federal IDR process by 

including proposals at 26 CFR 54.9816– 

6A, 29 CFR 2590.716–6A, and 45 CFR 

149.100 to require plans and issuers to 

provide claim adjustment reason codes 

(CARCs) and remittance advice remark 

codes (RARCs) when providing any 

paper or electronic remittance advice in 

response to a claim for payment for 

health care items or services furnished 

by an entity with which it does not have 

a direct or indirect contractual 

relationship. Additionally, the 

Departments propose amendments at 26 

CFR 54.9816–6, 29 CFR 2590.716–6, and 

45 CFR 149.140 to the information that 

must be disclosed about the QPA. These 

proposed rules would also establish 

new requirements at 26 CFR 54.9816–9, 

29 CFR 2590.716–9, and 45 CFR 

149.530, which would require plans and 

issuers to register with the Federal IDR 

portal to better enable a provider, 

facility, or provider of air ambulance 

services to identify the appropriate plan 

or issuer with which it has a dispute 

and determine whether its coverage of 

an item or service that is the subject of 

the dispute is subject to a specified State 

law, an All-Payer Model Agreement, or 

the Federal IDR process for determining 

the out-of-network rate. 

To further facilitate communication 

and improve open negotiations, these 

proposed rules would amend the open 

negotiation process that precedes the 

Federal IDR process. Specifically, at 26 

CFR 54.9816–8(b)(1), 29 CFR 2590.716– 

8(b)(1), and 45 CFR 149.510(b)(1), these 

proposed rules would amend the 

content requirements of the standard 

open negotiation notice, would establish 

requirements related to an open 

negotiation response notice, and would 

clarify the timing for when the open 

negotiation period begins. These 

proposed rules would also amend the 

process for initiating the Federal IDR 

process. Specifically, at 26 CFR 

54.9816–8(b)(2), 29 CFR 2590.716– 

8(b)(2), and 45 CFR 149.510(b)(2), these 

proposed rules would amend the 

content of the notice of IDR initiation 

and establish new requirements for a 

notice of IDR initiation response from 

the non-initiating party. At 26 CFR 

54.9816–8T(b)(3), 29 CFR 2590.716– 

8(b)(3), and 45 CFR 149.510(b)(3) these 

proposed rules would also establish a 

new manner for providing notices to the 

other party and the Departments. 

These proposed rules would also 

provide additional clarity regarding 

timeframes within the Federal IDR 

process. The No Surprises Act includes 

timeframes by which certain steps of the 

Federal IDR process must be completed. 

For example, the parties to a dispute 

must jointly select a certified IDR entity 

not later than the last day of the 3- 

business-day period following the date 

of the initiation of the Federal IDR 

process, and if the parties fail to jointly 

select a certified IDR entity, the 

Departments must select a certified IDR 

entity not later than 6 business days 

after the date of IDR initiation.76 While 

the No Surprises Act also provides 

detailed timeframes for certain other 

steps in the process, the steps that must 

be conducted before a payment 

determination can be issued are not as 

clearly defined, such as when a certified 

IDR entity must conduct a conflict-ofinterest review and must determine 

whether an item or service is a qualified 

IDR item or service, as defined in 26 

CFR 54.9816–8T(a)(2)(xi), 29 CFR 

2590.716–8(a)(2)(xi), and 45 CFR 

149.510(a)(2)(xi), and eligible for the 

Federal IDR process. Therefore, the 

provisions in these proposed rules 

would adjust certain steps and establish 

associated timeframes (see Table 1). 

This includes proposed provisions 

related to establishing a process for the 

preliminary selection of the certified 

IDR entity and the final selection of the 

certified IDR entity as set out in 26 CFR 

54.9816–8(c)(1), 29 CFR 2590.716– 

8(c)(1), and 45 CFR 149.510(c)(1), in 

order to account for the time it takes 

certified IDR entities to confirm that 

they do not have a conflict of interest 

with either party. To allow more time 

for certified IDR entities to conduct 

eligibility reviews, these proposed rules 

would include proposed amendments to 

the Federal IDR process eligibility 

review proposed in 26 CFR 54.9816– 

8T(c)(2), 29 CFR 2590.716–8(c)(2), and 

45 CFR 149.510(c)(2). As discussed in 

section I.H. of this preamble, eligibility 

reviews have proven to be complex and 

time consuming. In extenuating 

circumstances, such as when dispute 

volume is high, it may be more 

appropriate for the Departments, rather 

than certified IDR entities, to conduct 

eligibility reviews to facilitate quicker 

dispute processing. Therefore, these 

proposed rules would establish a 

departmental eligibility review process 

in proposed paragraph 26 CFR 54.9816– 

8(c)(2)(ii), 29 CFR 2590.716–8(c)(2)(ii), 

and 45 CFR 149.510(c)(2)(ii). Further, to 

support eligibility determinations, 

conflict-of-interest reviews, or payment 

determinations, the Departments 

propose requirements for the 

submission of additional information 

from the disputing parties at 26 CFR 

54.9816–8(c)(2)(iii), 29 CFR 2590.716– 

8(c)(2)(iii), and 45 CFR 

149.510(c)(2)(iii). To clarify and 

establish a standard process for disputes 

to be withdrawn from the Federal IDR 

process, the Departments propose four 

conditions in which a dispute may be 

withdrawn at 26 CFR 54.9816–8(c)(3)(i), 

29 CFR 2590.716–8(c)(3)(i), and 45 CFR 

149.510(c)(3)(ii). To further adjust 

timeframes and processes associated 

with the Federal IDR process, these 

proposed rules would include proposed 

amendments related to submission of 

offers and payment determination and 

notification at 26 CFR 54.9816–8(c)(5), 

29 CFR 2590.716–8(c)(5), and 45 CFR 

149.510(c)(5); the collection of the 

certified IDR entity fee at 26 CFR 

54.9816–8(d)(1), 29 CFR 2590.716– 

8(d)(1), and 45 CFR 149.510(d)(1); and 

the collection of the administrative fee, 

including a process for setting a reduced 

administrative fee for low-dollar amount 

disputes and for non-initiating parties in 

cases of ineligible disputes, at 26 CFR 

54.9816–8(d)(2), 29 CFR 2590.716– 

8(d)(2), and 45 CFR 149.510(d)(2). These 

proposed rules also include provisions 

to expand upon situations in which 

Federal IDR process timeframes may be 

waived due to extenuating 

circumstances at 26 CFR 54.9816–8T(g), 

29 CFR 2590.716–8(g), and 45 CFR 

149.510(g). 

Lastly, to address concerns regarding 

the vacated batching provision at 26 

CFR 54.9816–8T(c)(3)(i)(C), 29 CFR 

2590.716–8(c)(3)(i)(C), and 45 CFR 

149.510(c)(3(i)(C) and to create more 

efficiencies in the process, these 

proposed rules at 26 CFR 54.9816– 

8(c)(4), 29 CFR 2590.716–8(c)(4), and 45 

CFR 149.510(c)(4) would include 

provisions that would allow for more 

flexibility in batching multiple items or 

services in a single dispute. 

It is the Departments’ intention that 

the implementation of the proposed 

provisions in these proposed rules, if 

finalized, would lead to a more efficient 


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75756 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

Federal IDR process and more timely 

payment determinations. 

BILLING CODE 6325–63–P; 4830–01–P; 4510–29–P; 

4120–01–P 


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TABLE 1: The Federal IDR Process Under These Proposed Rules77 

Start 

Within 30 calendar days after the bill 

for the services is transmitted 

30 business days after the provider, 

facility, or provider of air am bu lance 

services receives an initial payment or 

notice of denial of payment 

30 business days 

Within the first 15 business days of 

the open negotiation period 

4 business days after the close of the 

open negotiation period 

3 business days after IDR initiation 

A furnished item or service results in a charge for emergency items or 

services from a nonparticipating provider or nonparticipating 

emergency facility, for non-emergency items or services from a 

nonparticipating provider at a participating health care facility, or for 

air ambulance services from a nonparticipating provider of air 

ambulance services. 

Initial Payment or Notice of Denial of Payment 

The plan or issuer determines whether the services are covered, and if 

the services are covered, sends to the provider, facility, or provider of 

air ambulance services an initial payment or notice of denial of 

a ment no later than 30 calendar da s after a bill is transmitted. 

Initiation of Open Negotiation Period 

An open negotiation period must be initiated within 30 business days 

beginning on the day the provider, facility, or provider of air 

ambulance services receives either an initial payment or a notice of 

denial of payment for the item or service from the plan or issuer. To 

initiate the open negotiation period, a party must submit a written 

open negotiation notice and supporting documentation to the other 

and to the De artments via the Federal IDR ortal. 

Open Negotiation Period 

Parties must exhaust a 30-business-day open negotiation period 

before either party may initiate the Federal IDR process. 

Open Negotiation Response Notice 

The party in receipt of the open negotiation notice must provide to the 

other party and to the Departments as soon as practicable, but no later 

than the 15th business day of the 30-business-day open negotiation 

period, a written notice and supporting documentation in response to . . . . . . 

Initiation of Federal IDR Process 

Either party can initiate the Federal IDR process by submitting a 

notice ofIDR initiation to the non-initiating party and to the 

Departments within the 4-business-day period beginning on the 1st 

business day after the close of the open negotiation period. The notice 

must include the initiatin 's referred certified IDR enti 

Notice ofIDR Initiation Response 

Within 3 business days ofreceipt of the notice of IDR initiation, the 

non-initiating party must submit the notice ofIDR initiation response 

form, attesting to whether the Federal IDR process applies to the 

item s or service s included in the notice of IDR initiation. The non-
Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75757 


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3-6 business days after IDR initiation 

2 business days after preliminary 

selection of the certified IDR entity 

3 business days after preliminary 

selection of the certified IDR entity 

1 business day after conflict-ofinterest attestation 

5 business days after final selection of 

the certified IDR entity 

initiating party must agree or object to the preferred certified IDR 

entity identified in the notice of IDR initiation by indicating its 

agreement or objection in the notice oflDR initiation response. If the 

non-initiating party objects to the preferred certified IDR entity 

identified in the notice ofIDR initiation, the non-initiating party must 

desil.!.nate an alternative preferred certified !DR entitv. 

Preliminary Selection of the Certified IDR Entity 

The date of the preliminary selection of the certified !DR entity will 

be 3 business days after the date of IDR initiation if the parties are 

considered to have jointly selected a certified IDR entity. 

The date of preliminary selection of the certified IDR entity will be 6 

business days after the date of IDR initiation if the parties are 

considered to have failed to jointly select a certified IDR entity. 

Administrative Fee Collection from the Initiating Party 

The initiating party must pay the administrative fee directly to the 

Departments within 2 business days of the date of preliminary 

selection of the certified IDR entity. Ifthc initiating party fails to pay 

its administrative fee, the dispute will be closed. 

Certified TOR Entity Conflict-of-Interest Review and Attestation 

Once preliminarily selected, the ce11ified IDR entity has 3 business 

days to submit an attestation that it does not have a conflict of 

interest. If a preliminarily selected certified !DR entity notifies the 

Departments that it does not meet the conflict-of-interest requirements 

or does not respond within 3 business days of being preliminarily 

selected, the Departments will randomly preliminarily select another 

certified IDR entity. Random selection will occur no later than the 

first business day after notification from the certified IDR entity or if 

the preliminary selection of the certified IDR entity fails to respond, 

no later than one business day aller the end ofthe 3-business-day 

period. 

Final Selection of the Certified IDR Entity 

The date of final selection of the certified IDR entity is the date that 

the Departments provide notice to the parties that the preliminarily 

selected certified !DR entity does not have a conflict of interest. This 

date will be no later than 1 business day after the conflict-of-interest 

attestation. 

Eligibility Review 

The certified IDR entity that was finally selected must review the 

information in the notice of IDR initiation, notice of IDR initiation 

response, and any additional information and determine whether the 

item or service is a qualified IDR item or service that is eligible for 

the Federal IDR process. The certified IDR entity must notify the 

Departments and both parties of its determination within 5 business 

days after the date offmal selection of the certified IDR entity. 
75758 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

77For a chart outlining the Federal IDR Process 

under the current regulations, see the Federal IDR 

Process Guidance for Disputing Parties at https://

www.cms.gov/files/document/federal-idr-guidancedisputing-parties-march-2023.pdf. 

78 86 FR 55994. 

79 Id. 

80U.S. Department of Health and Human 

Services, U.S. Department of Labor, and U.S. 

Department of the Treasury. (August 2022). 

Technical Assistance for Certified IDR Entities. 

https://www.cms.gov/files/document/TA-certifiedindependent-dispute-resolution-entities-August2022.pdf. 

BILLING CODE 6325–63–C; 4830–01–C; 4510–29–C; 

4120–01–C 

II. Overview of the Proposed Rules— 

Departments of the Treasury, Labor, 

and HHS 

A. Definition of Bundled Payment 

Arrangement 

Section 9816(c)(3)(B) of the Code, 

section 716(c)(3)(B) of ERISA, and 

section 2799A–1(c)(3)(B) of the PHS Act 

state that the Departments shall provide 

that, in the case of items and services 

which are included by a provider or 

facility as part of a bundled payment, 

such items and services included in 

such bundled payment may be part of 

a single determination. The October 

2021 interim final rules specify that in 

the case of qualified IDR items and 

services billed by a provider, facility, or 

provider of air ambulance services as 

part of a bundled payment arrangement, 

or if a plan or issuer makes or denies an 

initial payment as a bundled payment, 

the qualified IDR items and services 

may be submitted as part of one 

payment determination and are subject 

to the rules for batched determinations 

and the certified IDR entity fee for single 

determinations.78 The preamble to the 

October 2021 interim final rules 

describes a bundled payment 

arrangement as an instance in which a 

group health plan or health insurance 

issuer pays a provider, facility, or 

provider of air ambulance services a 

single payment for multiple items or 

services furnished during an episode of 

care to a single patient.79 To clarify how 

certified IDR entities can identify a 

dispute that includes a bundled 

payment arrangement, the Departments 

provided a definition for a bundled 

payment arrangement in the August 

2022 Technical Assistance for Certified 

IDR Entities.80 In that guidance, the 

Departments clarified that a single 

payment to one provider, facility, or 

provider of air ambulance services for 

multiple items or services must be made 

at the service code level for the entire 

bundle in order to be considered a 

bundled payment and therefore be 

treated as a single payment 

determination for the multiple items 

and services under the Federal IDR 

process. The Departments defined a 

bundled payment arrangement at the 

service code level because service codes 

are the principal mechanism by which 

health care services and supplies are 

identified and reimbursed. These rules 

propose to codify the clarification set 

forth in the August 2022 Technical 

Assistance for Certified IDR Entities. 

Specifically, the Departments propose to 

amend 26 CFR 54.9816–3T, 29 CFR 

2590.716–3, and 45 CFR 149.30 by 

defining the term ‘‘bundled payment 

arrangement’’ as an arrangement under 

which: (1) a provider, facility, or 

provider of air ambulance services bills 

for multiple items or services furnished 

to a single patient under a single service 

code that represents multiple items or 

services (for example, a DRG code); or 


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2 business days after eligibility Administrative Fee Collection from the Non-Initiating Party 

determination 

The non-initiating party must pay the administrative fee directly to the 

Departments within 2 business days ofan eligibility determination. 

10 business days after final selection Submission of Offers and Payment of Certified IDR Entity Fee 

of the certified IDR entity 

Parties must submit their offers to the certified IDR entity not later 

than 10 business days after the date of final selection of the certified 

IDR entity. Each party must pay the certified IDR entity fee (which 

the certified IDR entity will hold in a trust or an escrow account) no 

later than the date a disputing party submits its offer. If a party fails to 

pay the certified IDR entity fee, the party's offer will not be 

considered received. 

30 business days after final selection Selection of Offer 

of the certified IDR entity 

A certified IDR entity has 30 business days from the date of final 

selection of the certified IDR entity to determine the payment amount 

and notify the parties and the Departments of its decision. The 

certified IDR entity must select one of the offers submitted. 

30 calendar days after payment Payments Between Parties of Payment Determination Amount 

determination 

Any amount due from one party to the other party must be paid not 

later than 30 calendar days after the payment determination by the 

certified IDR entity. 

30 business days after the payment Refunding the Certified IDR Entity Fee to the Prevailing Party 

determination 

The certified IDR entity must refund the prevailing party's certified 

IDR entity fee within 30 business days after the payment 

determination. 
Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75759 

81The NCCI, developed by the Centers for 

Medicare & Medicaid Services, promotes correct 

national coding methodologies. Although created 

for the purpose of reducing improper Medicare Part 

B payments, the NCCI policy manual is also used 

by commercial payers. CMS. (Feb. 28, 2023). 

Medicare National Correct Coding Initiative (NCCI) 

Edits. https://www.cms.gov/medicare-medicaidcoordination/national-correct-coding-initiativencci/ncci-medicare/medicare-ncci-policy-manual. 

82 26 CFR 54.9816–8T(c)(3), 29 CFR 2590.716– 

8(c)(3), and 45 CFR 149.510(c)(3). 

83 26 CFR 54.9816–6T(d), 29 CFR 2590.716–6(d), 

and 45 CFR 149.140(d). As explained in section 

II.C. of this preamble, the Departments are 

proposing the following amendments to 26 CFR 

54.9816–6T(d), 29 CFR 2590.716–6(d), and 45 CFR 

149.140(d) to reflect that the concept of the 

recognized amount is not applicable to providers of 

air ambulance services: (1) requiring plans and 

issuers to disclose the QPA and certain information 

about the QPA when cost sharing is calculated 

using the QPA for an air ambulance service; and (2) 

requiring plans and issuers to provide these 

disclosures when the recognized amount (or with 

respect to air ambulance services, the amount on 

which cost sharing is based) is the QPA or the 

amount billed by the provider, facility, or provider 

of air ambulance services. 

84HIPAA requirements related to health care 

remittance advice transactions apply to ‘‘covered 

entities,’’ including ‘‘health plans’’ (which generally 

include plans and issuers) and ‘‘health care 

providers’’ (which include providers, facilities, and 

providers of air ambulance services that transmit 

any health information in electronic form in 

connection with an electronic transaction for which 

a standard has been adopted under HIPAA). 45 CFR 

160.102 and 45 CFR 160.103. For purposes of 

continuity with the rest of this preamble, this 

section uses the terms ‘‘plan’’ and ‘‘issuer’’ to refer 

to entities that are subject to HIPAA requirements 

that apply to ‘‘health plans’’ and the term 

‘‘providers, facilities, and providers of air 

ambulance services’’ to refer to entities that are 

subject to HIPAA requirements that apply to 

‘‘health care providers.’’ However, selfadministered group health plans with fewer than 50 

participants are excluded from the term ‘‘health 

plan’’ under 45 CFR 160.103 and are not subject to 

HIPAA requirements. 

85 45 CFR 162.1601 (‘‘The health care electronic 

funds transfers (EFT) and remittance advice 

transaction is the transmission of either of the 

following for health care: (a) The transmission of 

any of the following from a health plan to a health 

care provider: (1) Payment. (2) Information about 

the transfer of funds. (3) Payment processing 

information. (b) The transmission of either of the 

following from a health plan to a health care 

provider: (1) Explanation of benefits. (2) Remittance 

advice.’’). 

86The ASC X12N 835 Version 5010 (835 

transaction) is the current HIPAA standard that 

plans and issuers must use to electronically 

transmit explanation of benefits or remittance 

advice information to providers and facilities. As 

discussed later in this section II.B. of this preamble, 

the current ASC X12 standards predate, and 

therefore do not address, the No Surprises Act 

requirements. 

87 45 CFR 162.925(a)(1). See also Gerhardt, C. 

(March 22, 2022). Guidance on health plans’ 

payment of health care claims using Virtual Credit 

Cards (VCCs) and adopted HIPAA standards for 

Health Care Electronic Funds Transfers (EFT) and 

Electronic Remittance Advice (ERA) transactions. 

Centers for Medicare & Medicaid Services. https:// 

www.cms.gov/files/document/guidance-letter-vcceft-era.pdf. HIPAA regulations require that a 

covered entity conduct a transaction as a standard 

transaction when using electronic media to transmit 

a transaction for which the Secretary has adopted 

a standard (see 45 CFR 162.923(a)). HIPAA 

regulations also require a health plan to conduct 

transactions as standard transactions when 

requested to do so (see 45 CFR 162.925(a)(1)). 

HIPAA does not, however, obligate a health plan to 

conduct a transaction(s) that it would not otherwise 

conduct. 

88Centers for Medicare & Medicaid Services. 

(June 16, 2022). Health Care Payment and 

Remittance Advice and Electronic Funds Transfer. 

https://www.cms.gov/Regulations-and-Guidance/ 

Administrative-Simplification/Transactions/ 

HealthCarePaymentandRemittance

AdviceandElectronicFundsTransfer. 

(2) a plan or issuer makes an initial 

payment or notice of denial of payment 

to a provider, facility, or provider of air 

ambulance services under a single 

service code that represents multiple 

items or services furnished to a single 

patient (for example, a DRG code). 

For example, the August 2022 

Technical Assistance for Certified IDR 

Entities, the National Correct Coding 

Initiative (NCCI) Policy Manual 81

explains that if a physician performs 

bilateral mammography, the provider 

shall report (or for the purpose of the 

Federal IDR process, the provider shall 

bill) Current Procedural Terminology 

(CPT) code 77066 (Diagnostic 

mammography . . . bilateral). The 

provider should not submit CPT code 

77065 (Diagnostic mammography . . . 

unilateral) with 2 UOS or CPT code 

77065 LT (unilateral left breast 

mammography) plus CPT code 77065 

RT (unilateral right breast 

mammography). Under this example, 

the provider performed multiple 

services, and therefore, if the services 

are billed or reimbursed under one 

service code (CPT code 77066), all 

services performed under that service 

code (CPT codes 77065 LT and 77065 

RT) may be considered a bundled 

payment arrangement for purposes of 

the Federal IDR process. 

Further, under current rules at 26 CFR 

54.9816–8T(c)(3)(ii), 29 CFR 2590.716– 

8(c)(3)(ii), and 45 CFR 149.510(c)(3)(ii), 

bundled payment arrangements can be 

submitted as a single dispute and are 

subject to certified IDR entity fees for a 

single dispute rather than the higher 

fees for batched disputes (which may 

include multiple items or services from 

different claims between the same 

provider and plan but reflect the same 

service code or a similar code under a 

different procedural coding system). 

To further clarify the process for 

resolving IDR disputes for bundled 

payment arrangements, the Departments 

propose an amendment that would 

remove the language in the October 

2021 interim final rules stating that a 

bundled payment arrangement is subject 

to the rules for batched determinations. 

While a bundled payment arrangement 

by definition is billed by the same 

provider or group of providers, facility, 

or same provider of air ambulance 

services and paid by the same group 

health plan or health insurance issuer, 

not all requirements for batched 

determinations 82 apply to bundled 

payment arrangements. 

The Departments solicit comment on 

the definition and treatment of bundled 

payment arrangements. The 

Departments also solicit comment on 

examples of service or procedural codes 

other than DRGs that would meet the 

proposed definition of a bundled 

payment arrangement. 

B. Use of CARCs and RARCs 

1. Existing Payment Communication 

Practice and Requirements 

As described in section I.E. of this 

preamble, plans and issuers are 

currently required to disclose certain 

information to providers, facilities, and 

providers of air ambulance services 

when making an initial payment or 

notice of denial of payment when the 

recognized amount is the QPA.83 The 

Health Insurance Portability and 

Accountability Act of 1996 (HIPAA) 

mandated the adoption of electronic 

standards for certain health care 

transactions, including health care 

payment and remittance advice. Under 

HIPAA and regulations implementing 

the electronic transaction standards, 

these disclosures, when transmitted 

from a plan or issuer to a provider, 

facility, or provider of air ambulance 

services,84 meet the definition of a 

health care remittance advice 

transaction.85 Therefore, plans and 

issuers must comply with the 

Accredited Standards Committee (ASC) 

X12 implementation guide adopted at 

45 CFR 162.1602 when electronically 

transmitting the QPA disclosures 

required under 26 CFR 54.9816–6T(d), 

29 CFR 2590.716–6(d), and 45 CFR 

149.140(d) to a provider, facility, or 

provider of air ambulance services.86

Further, plans and issuers are required 

to send remittance information 

electronically upon the request of a 

provider, facility, or provider of air 

ambulance services, regardless of 

whether the requesting individual or 

entity is in the plan’s or issuer’s 

network or otherwise affiliated with the 

plan or issuer.87 When remittance 

advice is transmitted electronically, it is 

commonly referred to as an ERA. 

An ERA explains how a plan or issuer 

has adjusted claim charges based on 

factors like contract agreements, 

secondary payers, benefits coverage, and 

expected cost sharing.88 As noted earlier 

in this preamble section with reference 

to QPA disclosures, all ERAs must 


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89CARCs and RARCs are required by the ASC 

X12 835 transaction standard and are not currently 

required to be used on paper remittance advice. 

90 X12. (Nov. 16, 2022). Claim Adjustment Reason 

Codes. https://x12.org/codes/claim-adjustmentreason-codes. 

91 X12. (March 1, 2023). Remittance Advice 

Remark Codes. https://x12.org/codes/remittanceadvice-remark-codes. 

92CAQH CORE. (n.d). Ongoing Maintenance of 

the CORE Code Combinations. https://

www.caqh.org/core/ongoing-maintenance-corecode-combinations. 

93 X12. (March 1, 2023). Remittance Advice 

Remark Codes. https://x12.org/codes/remittanceadvice-remark-codes (complete list of approved 

RARC codes including No Surprises Act-specific 

codes); and Centers for Medicare & Medicaid 

Services. (March 1, 2022). Remittance Advice 

Remark Codes Related to the No Surprises Act. 

(unofficial reference list of No Surprises Actspecific RARC codes). 

94The ASC X12 835 transaction standard requires 

health plans to convey information about the 

adjudication of a claim using CARCS and RARCS. 

The Phase III 360 CORE Uniform Use of CARCs and 

RARCs (835) Rule, adopted at 45 CFR 162.1603 

requires plans to use specified combinations of 

CARCs and RARCs in certain business scenarios. 

CAQH CORE. (August 2022). CAQH CORE Payment 

and Remittance (835) Uniform Use of CARCs and 

RARCs Rule, Version PR.1.1. https://www.caqh.org/ 

sites/default/files/core/Payment-RemittanceCARCs-RARCs-Rule.pdf. 

95 ‘‘Standard transaction’’ means a transaction 

that complies with an applicable standard and 

associated operating rules adopted under the 

HIPAA Administrative Simplification requirements 

at 45 CFR part 162. 45 CFR 162.103. 

96For example, the Departments are aware of 

some cases where providers, facilities, and 

providers of air ambulance services used third 

parties to process remittances and did not realize 

the process for viewing the remittances through 

those third parties was filtering out information 

related to the No Surprises Act. Similarly, some 

providers, facilities, and providers of air ambulance 

services may view electronic remittance advice 

without realizing plans and issuers provided the 

QPA and related information on paper remittance 

advice. 

comply with the ASC X12 835 

transaction standard adopted by HHS 

under 45 CFR 162.1602. The X12 835 

implementation guide mandates the use 

of CARCs and RARCs to communicate 

remittance information (as opposed to 

any other code systems, such as 

proprietary codes developed by 

individual plans and issuers).89 The 

terms ‘‘CARC’’ and ‘‘RARC’’ are not 

defined in Federal statute but are 

described in the ASC X12 835 

implementation guide and the Council 

for Affordable Quality Healthcare 

Committee on Operating Rule for 

Information Exchange (CAQH CORE) 

operating rule adopted at 45 CFR 

162.1603(a)(4). CARCs explain why a 

claim or service line was paid 

differently than it was billed.90 RARCs 

provide additional explanations for an 

adjustment already described by a 

CARC or convey information about 

remittance processing. RARCs are either 

‘‘supplemental,’’ meaning that they 

provide additional explanation for an 

adjustment already described by a 

CARC, or ‘‘informational,’’ meaning 

they convey information about 

remittance processing and are never 

related to a specific adjustment or 

CARC.91 The lists of approved CARCs 

and RARCs are maintained by separate 

committees (the CARC Committee and 

the RARC Committee) designated by 

HHS to review requests to add, remove, 

or modify existing CARCs and RARCs. 

The HIPAA operating rule adopted at 45 

CFR 162.1603(a)(4) requires plans and 

issuers to use a uniform set of CARCs 

and RARCs for defined business 

scenarios. Updated lists of approved 

CARCs and RARCs, along with an 

updated list of approved code 

combinations and business scenarios, 

are published three times each year.92

The RARC Committee has approved a 

set of specific RARCs that convey 

information related to the No Surprises 

Act, including which of the No 

Surprises Act provisions apply to a 

claim, how cost sharing was calculated 

under the No Surprises Act, and 

whether a payment for a claim was an 

initial or final payment calculated in 

accordance with the No Surprises Act.93

These RARCs are currently available for 

use by plans and issuers, although the 

existing No Surprises Act-specific 

RARCs do not address all required QPA 

disclosures. The current standards and 

operating rules that govern ERA 

transactions under HIPAA were adopted 

prior to the enactment of the No 

Surprises Act and do not include 

specific requirements that dictate which 

combinations of CARCs and RARCs 

must be used to communicate claim 

adjudication information in business 

scenarios anticipated by the No 

Surprises Act.94

Plans and issuers consequently 

convey the disclosures required under 

the No Surprises Act to providers, 

facilities, and providers of air 

ambulances through a variety of 

methods, including electronic and paper 

remittance advice. These disclosures, if 

more effectively communicated, would 

provide providers, facilities, and 

providers of air ambulance services with 

more accessible information to 

determine whether they may initiate 

open negotiation and the Federal IDR 

process. However, in part because plans 

and issuers are not able to transmit all 

of the required disclosures through 

standard transactions,95 such as the ASC 

X12 835 transaction, providers, 

facilities, and providers of air 

ambulance services have reported to the 

Departments that they are not always 

aware of, or cannot understand, the 

disclosures even when the plan or 

issuer claims to have met the disclosure 

requirements.96 Moreover, the 

Departments’ ability to assess how often 

CARCs and RARCs are used to convey 

information related to the No Surprises 

Act is limited due to the minimal 

available data on uptake and the 

absence of guidance, standards, or 

operational rules specifying how these 

codes must be used. Informal feedback 

from providers, facilities, and providers 

of air ambulance services and plans and 

issuers suggests that some plans and 

issuers are using some of these codes, 

including when providing paper 

remittance advice, but there is not yet 

widespread usage. 

2. Proposal To Require CARCs and 

RARCs To Improve Communication 

Between Plans and Issuers and 

Providers, Facilities, and Providers of 

Air Ambulance Services 

Gaps in communication between 

plans and issuers and providers, 

facilities, and providers of air 

ambulance services contribute to 

inefficiencies in resolving disputes in 

the Federal IDR process. The 

Departments have identified the 

following areas of confusion, reported 

by plans, issuers, providers, facilities, 

providers of air ambulance services, and 

certified IDR entities, which are also 

consistent with the Departments’ 

experience administering the Federal 

IDR process: (1) whether the consumer 

protections against balance billing and 

out-of-network cost sharing under the 

No Surprises Act apply to an item or 

service; (2) how cost sharing and the 

out-of-network rates are determined 

(that is, through an All-Payer Model 

Agreement, specified State law, or the 

Federal rules); (3) how and with whom 

to initiate open negotiations; and (4) 

which items or services eligible for the 

Federal IDR process can be batched or 

bundled into one dispute. 

To address communication challenges 

described in section II.B.1. of this 

preamble, the Departments propose new 

disclosure rules at 26 CFR 54.9816–6A, 

29 CFR 2590.716–6A, and 45 CFR 

149.100. These proposed provisions 

would require plans and issuers to use 

CARCs and RARCs, as specified in 

guidance issued by the Departments 

(and discussed elsewhere in this section 

II.B. of this preamble), or as required 

under any applicable adopted standards 

and operating rules under 45 CFR part 

162, to communicate information 

related to whether a claim for an item 

or service furnished by an entity that 

does not have a direct or indirect 


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97The No Surprises Act does not include the 

same language addressing disclosures to providers 

of air ambulance services. However, the July 2021 

interim final rules implemented the statute’s costsharing requirements for air ambulance services by 

requiring that plans and issuers base any 

coinsurance and deductible for air ambulance 

services furnished by a nonparticipating provider of 

air ambulance services on the lesser of the QPA or 

the billed amount for the services. 86 FR 36884. 

Therefore, the July 2021 interim final rules also 

applied the requirement to make disclosures 

regarding the QPA with respect to providers of air 

ambulance services. As stated in the preamble to 

the July 2021 interim final rules, the Departments 

recognize that providers of air ambulance services 

subject to the surprise billing rules (as well as 

providers and emergency facilities) need 

transparency regarding how the QPA was 

calculated in order to inform the open negotiation 

process and the decision whether to initiate the 

Federal IDR process and what offer to submit. 86 

FR 36898. 

98This proposal would not alter HHS’ authority 

under HIPAA to implement future guidance with 

respect to electronic remittance advice or to adopt 

new or modified standards or operating rules in 

accordance with Title XI Part C—Administrative 

Simplification of the Social Security Act. 

contractual relationship with the plan or 

issuer with respect to the furnishing of 

such item or service under the plan or 

coverage is subject to the provisions of 

26 CFR 54.9816 and 54.9817; 29 CFR 

2590.716 and 2590.717; or 45 CFR part 

149, subparts B, E, or F. To improve the 

functioning of the Federal IDR process 

and ensure timely rendering of payment 

determinations, the Departments are of 

the view that providers, facilities, and 

providers of air ambulance services 

need information to understand not 

only when items and services are 

subject to the No Surprises Act, but also 

when they are not, to avoid submission 

of ineligible disputes to the Federal IDR 

process. 

The Departments have the authority 

under section 9816(a)(2)(B)(ii) of the 

Code, section 716(a)(2)(B) of ERISA, and 

section 2799A–1(a)(2)(B)(ii) of the PHS 

Act to establish through rulemaking the 

information that a plan or issuer must 

share with a provider or facility when 

making a determination of the QPA, 

including the form and manner of such 

disclosures.97 The Departments also 

have authority under section 9833 of the 

Code, section 734 of ERISA, and section 

2792 of the PHS Act to issue such 

regulations as may be necessary and 

appropriate to carry out the provisions 

of chapter 100 of the Code, part 7 of 

ERISA, and title XXVII of the PHS Act, 

including the provisions directing the 

Departments to establish the Federal 

IDR process. 

Under these authorities, the 

Departments propose to require plans 

and issuers to use CARCs and RARCs to 

convey specific information about the 

No Surprises Act when a plan or issuer 

provides a paper or electronic 

remittance advice to any entity with 

which it does not have a direct or 

indirect contractual relationship with 

respect to the furnishing of an item or 

service under the plan or coverage. 

Specifically, under these proposed 

rules, a plan or issuer would be required 

to use CARCs and RARCs in accordance 

with guidance issued by the 

Departments when, with respect to an 

entity with which it does not have a 

direct or indirect contractual 

relationship, the plan or issuer provides 

a paper or electronic remittance advice 

to a provider, facility, or provider of air 

ambulance services for an initial 

payment, notice of denial of payment, or 

total plan or coverage payment required 

under the No Surprises Act. 

These proposed requirements would 

also apply to plans and issuers when 

sending remittance advice to entities 

with which they do not have a direct or 

indirect contractual relationship with 

respect to items and services to which 

the No Surprises Act surprise billing 

requirements do not apply, in order to 

convey that the No Surprises Act does 

not apply. 

Requiring plans and issuers to use 

approved CARCs and RARCs to convey 

information related to the No Surprises 

Act on both electronic and paper 

remittance advice would better facilitate 

the flow of information between plans 

and issuers and providers, facilities, and 

providers of air ambulance services and 

increase efficiencies in the processing of 

claims subject to the No Surprises Act’s 

surprise billing protections. This 

requirement would also assist providers, 

facilities, and providers of air 

ambulance services in identifying items 

and services that are not eligible for the 

Federal IDR process as early as the 

initial payment or notice of denial of 

payment, thereby reducing the 

submission of ineligible payment 

disputes to the Federal IDR process. 

This would decrease the need for 

outreach by certified IDR entities and 

allow them to concentrate resources on 

making payment determinations for 

eligible disputes. 

In addition, the Departments 

anticipate that the proposed 

requirement to use CARCs and RARCs 

would provide valuable information to 

certified IDR entities in determining 

whether disputing parties agree on the 

eligibility of a dispute for the Federal 

IDR process after it has been submitted. 

As described in section II.D.1. of this 

preamble, the Departments propose to 

require that the open negotiation notice 

include a copy of the initial payment or 

notice of denial of payment, which 

would, under the proposal described in 

this section of this preamble, include 

CARCs and RARCs related to the No 

Surprises Act. The Departments also 

propose, as described in section II.D.1. 

of this preamble, to require the open 

negotiation notice be submitted to the 

Departments through the Federal IDR 

portal. This would help ensure that, 

even if a plan or issuer does not respond 

to a notice of IDR initiation, the certified 

IDR entity has access to certain 

information regarding whether the plan 

or issuer believes the dispute could be 

eligible for the Federal IDR process, 

thereby avoiding unnecessary or 

duplicative outreach to the parties when 

possible. 

As discussed in section V.D. of this 

preamble, requiring the use of CARCs 

and RARCs as described in these 

proposed rules would result in an 

increase in burden for plans (or their 

third party administrators (TPAs)) and 

issuers, as they would need to 

implement and automate the use of new 

CARCs and RARCs. However, because 

all plans and issuers that provide ERA 

transactions subject to the HIPAA 

Administrative Simplification 

requirements already are required to use 

CARCs and RARCs, the Departments 

anticipate that most plans and issuers 

would generally have the capacity to 

provide No Surprises Act-specific 

CARCs and RARCs. The Departments 

seek comment on any circumstances in 

which it would not be possible for a 

plan or issuer to determine whether an 

item or service included on a remittance 

advice is, or is not, subject to the 

Federal IDR process at the time the 

remittance advice is issued to a 

provider, facility, or provider of air 

ambulance services. The Departments 

also seek comment on the technical and 

operational steps that would be 

necessary to initially implement new No 

Surprises Act-specific CARCs and 

RARCs, including for plans and issuers 

that do not currently use CARCs and 

RARCs, or that are currently able to 

accommodate only one CARC and 

RARC combination per line item. 

The Departments propose that certain 

procedural aspects of this proposal 

would be implemented through 

guidance issued by the Departments.98

Should the proposal described in this 

section of the preamble be finalized, the 

Departments would be authorized to 

require plans and issuers to use CARCs 

and RARCs to communicate information 

related to whether a claim for an out-ofnetwork item or service is or is not 

subject to the surprise billing provisions 

of the No Surprises Act. The guidance 

issued under this authority would 

identify specific CARCs and RARCs and 

describe the specific circumstances in 


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99Sections 1172 and 1173 of the Social Security 

Act and 45 CFR 162.910. 

100 In TMA III, the District Court vacated the 

language in 26 CFR 54.9817–1T(b)(4)(i), 29 CFR 

2590.717–1(b)(4)(i), and 45 CFR 149.130(b)(4)(i), 

that stated with respect to air ambulance services, 

‘‘For purposes of this paragraph (b)(4)(i), the 30- 

calendar-day period begins on the date the plan or 

issuer receives the information necessary to decide 

a claim for payment for the services.’’ See 

Memorandum Opinion and Order, Tex. Med. 

Ass’n., et al. v. U.S. Dep’t of Health and Hum. 

Servs., No. 6:22–cv–00450–JDK (E.D. Tex. August 

24, 2023). Because a plan or issuer may not have 

the information necessary to decide a claim for 

payment within the 30-calendar-day period, the 

Departments are considering whether CARCs and 

RARCs may be useful in such circumstances. 

101 26 CFR 54.9816–8T(c)(3)(i)(B), 29 CFR 

2590.716–8(c)(3)(i)(B), and 45 CFR 

149.510(c)(3)(i)(B). 

102See discussion in section I.H. of of this 

preamble related to the provisions of the July 2021 

interim final rules that allow self-insured group 

health plans, including self-insured non-Federal 

governmental plans, to voluntarily opt into a 

specified State law. 

which the identified CARCs and RARCs 

must be used. As discussed in section 

II.B.1. of this preamble, this approach 

also mirrors the existing framework 

under HIPAA, in which required CARC 

and RARC code combinations are issued 

through guidance, as authorized by 

regulation. This would provide the 

Departments with the flexibility to 

specify the use of CARCs and RARCs, 

including new No Surprises Act-specific 

RARCs that may be developed in the 

future, while the Departments work to 

address communication challenges 

affecting the surprise billing provisions 

of the No Surprises Act. It would also 

provide flexibility for the Departments 

to discontinue the use of certain CARCs 

and RARCs should the information 

communicated using those CARCs and 

RARCs become readily available to 

providers, facilities, or providers of air 

ambulance services through a different 

mechanism or otherwise become 

unnecessary. As discussed in more 

detail in section II.H.1. of this preamble, 

the Departments propose that plans and 

issuers would have a period of time 

following the issuance of guidance to 

implement the use of CARCs and 

RARCs in accordance with the 

guidance. 

HHS is not proposing changes to the 

HIPAA transaction standards (such as 

the X12 835 standard) or operating rules 

in these proposed rules. HHS continues 

to monitor the implementation of the No 

Surprises Act in order to determine 

whether future changes to the HIPAA 

transaction standards and operating 

rules, in accordance with the mandated 

HIPAA standards and operating rules 

development and adoption processes,99

might provide a long-term mechanism 

for facilitating communication related to 

the No Surprises Act between plans and 

issuers and providers, facilities, and 

providers of air ambulance services. 

The Departments are of the view that 

it would be beneficial to standardize No 

Surprises Act-related communications 

between plans and issuers and 

providers, facilities, and providers of air 

ambulance services, regardless of 

whether the information is transmitted 

using HIPAA standard transactions. 

Therefore, under this proposal, the 

Departments would issue guidance 

regarding the use of CARCs and RARCs 

in both electronic transactions as well as 

formats outside the purview of the 

HIPAA transaction standards, including 

paper remittance advice. While CARCs 

and RARCs have not been widely used 

to transmit information outside of ERA 

transactions, the Departments 

understand that some plans and issuers 

routinely communicate with providers, 

facilities, and providers of air 

ambulance services using paper 

remittance advice and other formats 

outside the purview of the HIPAA 

transaction standards. 

In addition to the RARCs related to 

the No Surprises Act described 

previously in this section of the 

preamble that have been approved for 

use, the Departments are assessing 

whether additional CARCs or RARCs 

could be helpful for improving 

communication between parties about 

how out-of-network claims are being 

processed in relation to the No 

Surprises Act. For example, the 

Departments are considering whether it 

would be beneficial to require the use of 

CARCs and RARCs when plans and 

issuers have insufficient information to 

determine coverage for a claim from a 

nonparticipating provider of air 

ambulance services.100 The 

Departments are also considering 

whether it would be beneficial to 

require the use of RARCs that could be 

used to provide any of the information 

required to be disclosed about the QPA 

under 26 CFR 54.9816–6T(d), 26 CFR 

54.9816–6(d), 29 CFR 2590.716–6(d), 

and 45 CFR 149.140(d). It also may be 

helpful to have a RARC that specifies 

that the No Surprises Act surprise 

billing protections do not apply. In 

addition, a large proportion of the 

disputes determined ineligible for the 

Federal IDR process by certified IDR 

entities involve items or services that 

providers, facilities, or providers of air 

ambulance services batched improperly 

because they did not realize that a TPA 

was administering coverage for multiple 

self-insured plans rather than a single 

issuer or group health plan, and the 

items and services were thus ineligible 

to be batched.101 Certified IDR entities 

have determined that other disputes are 

ineligible for the Federal IDR process 

because the self-insured plan involved 

in the dispute had voluntarily opted in 

to a specified State law.102 A RARC that 

could clearly identify a payer as a selfinsured plan may reduce the number of 

disputes that are initiated and 

determined ineligible on the basis of a 

batching or jurisdictional error. The 

Departments solicit comment on 

whether and what information not 

conveyed in the existing RARCs would 

be helpful to convey through the 

creation of additional RARCs related to 

the No Surprises Act’s surprise billing 

provisions. 

The Departments are aware that some 

States require issuers to use CARCs and 

RARCs to communicate information 

about State surprise billing laws. The 

Departments seek comment regarding 

experience with these requirements, 

including whether such requirements 

have been effective, and any challenges 

related to implementing such 

requirements. Should these proposed 

rules be finalized, the Departments note 

that nothing in these proposed rules 

would prevent a State from requiring 

that issuers use specific CARCs or 

RARCs in addition to those specified in 

the No Surprises Act-specific Federal 

guidance that the Departments would be 

authorized to issue; nor would a State 

or other entity be prevented from 

engaging with the relevant committees 

to request the creation or use of a CARC 

or RARC in addition to those specified 

in such guidance. 

Prior to the enactment of the No 

Surprises Act, out-of-network providers, 

facilities, and providers of air 

ambulance services commonly sought 

reimbursement directly from patients 

rather than from a plan or issuer, 

requiring a participant, beneficiary, or 

enrollee to then seek reimbursement for 

all or part of the cost of the out-ofnetwork service directly from their plan 

or issuer. Because the No Surprises Act 

prohibits nonparticipating providers, 

facilities, and providers of air 

ambulance services from billing or 

holding liable a participant, beneficiary, 

or enrollee for an amount greater than 

the applicable in-network cost-sharing 

requirement for items and services 

subject to the No Surprises Act, direct 

billing of patients is now largely limited 

to items and services to which surprise 

billing protections in the No Surprises 

Act do not apply. The Departments 

understand that requiring the plan or 

issuer to convey CARC or RARC 

information related to eligibility for 

such processes to a participant, 


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103The Departments are aware that different 

terms are sometimes used, such as paper remittance 

advice or explanation of payment, when referring 

to the paper communication that accompanies a 

payment or notice of denial of payment to a 

provider or facility for a claim and provides 

additional information about the adjudication of the 

claim for which payment is being made. 

104 86 FR 36898; 87 FR 52633. 

105 26 CFR 54.9816–6T(d) and 54.9816–6(d), 29 

CFR 2590.716–6(d), and 45 CFR 149.140(d). 106 86 FR 36884. 

107 86 FR 55980. 

108The Departments anticipate finalizing 

additional corrections to address this issue when 

finalizing the remainder of the July 2021 interim 

final rules. 

109 26 CFR 54.9816–8T(b)(1)(i), 29 CFR 2590.716– 

8(b)(1)(i), and 45 CFR 149.510(b)(1)(i). 

beneficiary, or enrollee in this 

circumstance would represent an 

administrative burden on the plan or 

issuer without any clear benefit to the 

participant, beneficiary, or enrollee. In 

addition, such a requirement would not 

further the aims of these proposed rules 

to facilitate timely rendering of payment 

determinations and to improve the 

functioning of the Federal IDR process, 

in which a participant, beneficiary, or 

enrollee cannot participate as a party. 

Therefore, the requirement to use 

CARCs and RARCs under these 

proposed rules would not apply for outof-network items and services for which 

the plan or issuer makes payment 

directly to the participant, beneficiary, 

or enrollee. The Departments seek 

comment on whether a plan or issuer 

should generate a remittance advice that 

can be obtained upon request by the 

provider, facility, or provider of air 

ambulance services when the plan or 

issuer makes a payment directly to a 

participant, beneficiary, or enrollee, and 

whether the requirement to use CARCs 

and RARCs to convey No Surprises Actspecific information as proposed in 

these rules should apply in these 

circumstances. 

While the proposal refers to any paper 

or electronic remittance advice,103 the 

Departments seek comment on whether 

a more general term, such as ‘‘any 

remittance advice,’’ would be helpful in 

characterizing the types of 

communications accompanying 

payments for items and services. The 

Departments also seek comment on this 

proposal generally. 

C. Information To Be Shared About the 

QPA 

As described in sections I.B. and I.E. 

of this preamble, the July 2021 interim 

final rules and August 2022 final rules 

provide that if the recognized amount 

with respect to an item or service is the 

QPA, plans and issuers must make 

certain disclosures about the QPA with 

each initial payment or notice of denial 

of payment and must also provide 

certain additional information upon 

request.104 This information must be 

provided in writing, either on paper or 

electronically, to a provider, facility, or 

provider of air ambulance services, as 

applicable.105

While these requirements were 

intended to ensure the disclosure of 

information about the QPA in any 

instance in which an item or service 

would be eligible for the Federal IDR 

process, the text of the current 

regulation directs plans and issuers to 

make these disclosures only if the 

recognized amount with respect to an 

item or service furnished by a provider, 

facility, or provider of air ambulance 

services is the QPA. The Departments 

propose a change to reflect that the term 

‘‘recognized amount’’ is not used in the 

statute or regulations for purposes of 

determining cost sharing with respect to 

air ambulance services furnished by 

nonparticipating providers of air 

ambulance services. Rather, under the 

July 2021 interim final rules, plans and 

issuers must calculate the cost-sharing 

amount for air ambulance services 

furnished by a nonparticipating 

provider of air ambulance services as if 

the total amount that would have been 

charged were equal to the lesser of the 

QPA or the billed amount for the 

services.106 Therefore, the Departments 

propose to amend the regulations to 

specify that plans and issuers must, in 

the case of air ambulance services, 

disclose the QPA and certain 

information about the QPA when cost 

sharing is calculated using the QPA. In 

addition, the Departments propose to 

require plans and issuers to make the 

same disclosures when the recognized 

amount (or with respect to air 

ambulance services, the amount on 

which cost sharing is based) is the 

amount billed by the provider, facility, 

or provider of air ambulance services, 

and not only when the recognized 

amount (or with respect to air 

ambulance services, the amount on 

which cost sharing is based) is the QPA, 

as these items and services would also 

be eligible for the Federal IDR process 

(provided all other eligibility criteria are 

satisfied). 

Under 26 CFR 54.9816–6T(d)(1)(iv), 

29 CFR 2590.716–6(d)(1)(iv), and 45 

CFR 149.140(d)(1)(iv), a plan or issuer 

making disclosures about the QPA must 

include a statement that if the provider 

or facility wishes to initiate a 30-day 

open negotiation period for purposes of 

determining the amount of total 

payment, the provider or facility may 

contact the appropriate person or office 

to initiate open negotiation, and if the 

30-day open negotiation period does not 

result in a determination, generally the 

provider or facility may initiate the 

Federal IDR process 4 days after the end 

of the open negotiation period. Under 

26 CFR 54.9816–6T(d)(2), 29 CFR 

2590.716–6(d)(2), and 45 CFR 

149.140(d)(2), plans and issuers are 

required to disclose additional 

information in a timely manner upon 

the request of the provider or facility. 

The Departments propose technical 

and conforming amendments to align 

these requirements with the October 

2021 interim final rules 107 and current 

practice. First, the Departments 

acknowledge that 26 CFR 54.9816– 

6T(d), 29 CFR 2590.716–6(d), and 45 

CFR 149.140(d) do not consistently 

include references to providers of air 

ambulances services when referring to 

providers and facilities, and propose 

amendments to clarify that these 

disclosure requirements apply with 

respect to providers of air ambulance 

services (in addition to providers and 

facilities). Specifically, in 26 CFR 

54.9816–6T, 29 CFR 2590.716–6, and 45 

CFR 149.140, the Departments propose 

to amend the introductory language in 

paragraph (d), paragraph (d)(1)(iv), and 

the introductory language of paragraph 

(d)(2) to clarify the applicability with 

respect to disclosures to providers of air 

ambulance services.108 Second, the 

Departments propose to align the 

timeframes described in the disclosure 

with the timeframes established in the 

October 2021 interim final rules,109 by 

specifying that days are counted using 

business days (rather than calendar 

days), where applicable. The 

Departments also propose an 

amendment to align the language in 26 

CFR 54.9816–6T(d)(1)(iv), 29 CFR 

2590.716–6(d)(1)(iv), and 45 CFR 

149.140(d)(1)(iv) with the same 

requirements established in the October 

2021 interim final rules by replacing the 

phrase ‘‘amount of total payment’’ with 

the term ‘‘out-of-network rate,’’ as 

defined in 26 CFR 54.9816–3T, 29 CFR 

2590.716–3, and 45 CFR 149.30, and by 

describing an unsuccessful open 

negotiation period as not resulting in an 

‘‘agreement on the amount of payment’’ 

rather than a ‘‘determination.’’ 

The Departments further propose to 

require that the statement also explain 

that the provider, facility, or provider of 

air ambulance services must notify the 

Departments as described under 

proposed 26 CFR 54.9816–8(b)(1)(i), 29 

CFR 2590.716–8(b)(1)(i), and 45 CFR 

149.510(b)(1)(i), as applicable, to initiate 


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110For a discussion of the proposed requirement 

to notify the Departments when initiating open 

negotiation, see section II.D.1.c. of this preamble. 

111 86 FR 36898. 

112 87 FR 52625. 

113For a discussion of the proposal to establish 

a Federal IDR registry and assign a registration 

number to each plan and issuer, see section II.F. of 

this preamble. 114 86 FR 55990. 

115As clarified in the July 2021 interim final 

rules, the initial payment should be an amount that 

the plan or issuer reasonably intends to be payment 

in full based on the relevant facts and 

circumstances, prior to the beginning of any open 

negotiations or initiation of the Federal IDR process. 

(86 FR 36900 through 36901). 

116 86 FR 55990. 

117See 86 FR 55991. 

open negotiation.110 The Departments 

propose that plans and issuers include 

this explanation as part of the disclosure 

once the open negotiation notice can be 

submitted through the Federal IDR 

portal. 

As stated in the preamble to the July 

2021 interim final rules 111 and the 

August 2022 final rules,112 the 

Departments seek to ensure transparent 

and meaningful disclosure of 

information relating to the calculation of 

the QPA for providers, facilities, and 

providers of air ambulance services, 

while at the same time minimizing 

administrative burdens on plans and 

issuers and on the Federal IDR process. 

The Departments are now of the view 

that additional disclosure of information 

with the QPA is critical to ensuring that 

all parties have the information 

necessary to determine whether a 

payment dispute is eligible for the 

Federal IDR process. The Departments 

therefore propose to amend 26 CFR 

54.9816–6T, 29 CFR 2590.716–6, and 45 

CFR 149.140 by re-designating 

paragraph (d)(1)(v) as (d)(1)(vi) and 

adding a new paragraph (d)(1)(v) that 

would require plans and issuers to 

disclose the legal business name of the 

plan (if any) or issuer; the legal business 

name of the plan sponsor (if applicable); 

and the registration number assigned 

under proposed 26 CFR 54.9816–9, 29 

CFR 2590.716–9, or 45 CFR 149.530, as 

applicable, if the plan or issuer is 

registered with the Federal IDR 

registry.113 The Departments seek 

comment on the specific technical and 

operational steps that would be 

necessary for plans and issuers to 

disclose this additional information 

when providing an initial payment or 

notice of denial of payment. Further, the 

Departments are seeking comment on 

the appropriate implementation period 

that would allow plans and issuers to 

complete these steps to comply with 

these proposed rules, if finalized. As 

noted in section II.B. of this preamble, 

the Departments are also seeking 

comment on whether any of the 

additional proposed disclosures should 

be required to be communicated using 

a CARC or RARC specified in guidance 

issued by the Departments. 

D. Open Negotiation and Initiation of 

the Federal IDR Process 

Section 9816(c)(1)(A) of the Code, 

section 716(c)(1)(A) of ERISA, section 

2799A–1(c)(1)(A) of the PHS Act, and 

the October 2021 interim final rules 

establish that, when the out-of-network 

rate is not determined by reference to an 

All-Payer Model Agreement under 

section 1115A of the Social Security Act 

or specified State law as defined in 26 

CFR 54.9816–3T, 29 CFR 2590.716–3, 

and 45 CFR 149.30, the plan or issuer 

or provider or facility may engage in 

open negotiations to determine the total 

out-of-network rate (inclusive of any 

cost sharing).114 If the parties fail to 

reach an agreement through open 

negotiation, they may initiate the 

Federal IDR process. Section 9817(b) of 

the Code, section 717(b) of ERISA, and 

section 2799A–2(b) of the PHS Act 

provide that out-of-network rates for air 

ambulance services may be determined 

through open negotiation or an IDR 

process that is largely identical to the 

process provided for in section 9816(c) 

of the Code, section 716(c) of ERISA, 

and section 2799A–1(c) of the PHS Act. 

Thus, the preamble and regulatory text 

describing open negotiations and the 

Federal IDR process generally apply to 

providers of air ambulance services, 

unless otherwise specified. 

1. Open Negotiation 

The Departments propose to amend 

the open negotiation provisions of 26 

CFR 54.9816–8T(b)(1)(i) and (ii), 29 CFR 

2590.716–8(b)(1)(i) and (ii), and 45 CFR 

149.510(b)(1)(i) and (ii) to establish 

additional requirements for initiating 

open negotiation and to revise the open 

negotiation period start date. In 

addition, the Departments propose to 

add a new paragraph at 26 CFR 

54.9816–8(b)(1)(iii), 29 CFR 2590.716– 

8(b)(1)(iii), and 45 CFR 149.510(b)(1)(iii) 

that would establish a requirement that 

in response to a party’s written notice of 

its intent to negotiate (open negotiation 

notice), the party in receipt of the notice 

must provide a written open negotiation 

response notice. In these proposed 

rules, the Departments propose 

amendments to the content 

requirements for the open negotiation 

notice. The Departments also propose to 

require an open negotiation response 

notice from non-initiating parties, 

including specific content requirements. 

Section 9816(c)(1)(A) of the Code, 

section 716(c)(1)(A) of ERISA, section 

2799A–1(c)(1)(A) of the PHS Act, and 

the October 2021 interim final rules 

establish that the open negotiation 

period may be initiated by either party 

during the 30-business-day period 

beginning on the day the provider, 

facility, or provider of air ambulance 

services receives either an initial 

payment or a notice of denial of 

payment for an item or service.115 The 

October 2021 interim final rules provide 

that in order for a plan, issuer, provider, 

facility, or provider of air ambulance 

services to know when it is a party to 

an open negotiation period and the item 

or service for which the payment is the 

subject of open negotiation, the party 

initiating open negotiation must provide 

to the other party a written open 

negotiation notice.116 Under 26 CFR 

54.9816–8T(b)(1)(ii)(A), 29 CFR 

2590.716–8(b)(1)(ii)(A), and 45 CFR 

149.510(b)(1)(ii)(A), an open negotiation 

notice must include information 

sufficient to identify the item(s) and 

service(s) (including the date(s) the 

item(s) or service(s) were furnished, the 

service code, and the initial amount, if 

applicable, an offer of an out-of-network 

rate, and contact information for the 

party sending the open negotiation 

notice). The day on which the open 

negotiation notice is first sent by the 

party is the date that the 30-businessday open negotiation period begins. 

Consistent with the October 2021 

interim final rules, negotiation during 

the open negotiation period occurs 

without the involvement of the 

Departments or a certified IDR entity.117

Furthermore, the requirement to 

complete a 30-business-day open 

negotiation period before initiating the 

Federal IDR process does not preclude 

the parties from reaching an agreement 

in fewer than 30 business days. 

However, in the event the parties do not 

reach an agreement, they still must 

exhaust the 30-business-day open 

negotiation period before either party 

may initiate the Federal IDR process. 

The Departments encourage disputing 

parties to negotiate in good faith during 

this time period to reach an agreement 

on the out-of-network rate. The 

Departments expect parties to make a 

genuine effort to exchange information 

with one another at reasonable times 

and intervals with the goal of reaching 

a solution satisfactory to both parties. 

To the extent parties reach an agreement 

during the open negotiation period, they 

can avoid the administrative fee and 


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118 86 FR 55990. 

119 26 CFR 9816–8T(b)(3), 29 CFR 2590.716– 

8(b)(3), and 45 CFR 149.510(b)(3). 

other costs associated with the Federal 

IDR process. 

The preamble to the October 2021 

interim final rules explained that, given 

that the parties already would have 

made initial contact (namely, the 

provider, facility, or provider of air 

ambulance services transmitted a bill to 

the plan or issuer, and the plan or issuer 

sent an initial payment or notice of 

denial of payment to the provider, 

facility, or provider of air ambulance 

services), the Departments expected the 

parties to provide effective notice and 

encouraged the parties to take 

reasonable measures to confirm the 

other party’s contact information and 

confirm electronic receipt through 

approaches such as read receipts, 

especially if a party does not initially 

respond to an open negotiation 

notice.118 Further, the Departments 

contemplated that issues related to 

eligibility and jurisdiction would be 

resolved through the disclosures that 

plans and issuers are required to 

provide with their initial payment or 

notice of denial of payment or, through 

the required 30-business-day open 

negotiation period. However, disputing 

parties and certified IDR entities have 

reported that disputing parties are 

sometimes not actively negotiating with 

each other during the required period as 

expected by the Departments. In 

addition, non-initiating parties and 

certified IDR entities continue to 

express concern that initiating parties 

sometimes do not properly initiate or 

complete the open negotiation period 

before initiating the Federal IDR 

process. Plans and issuers also have 

expressed concern with the 

Departments and the certified IDR 

entities, that providers, facilities, and 

providers of air ambulance services 

overwhelm them with requests to 

negotiate items or services that are 

ineligible for the Federal IDR process. 

At the same time, providers, facilities, 

and providers of air ambulance services 

assert that plans and issuers rarely 

respond to their notices initiating open 

negotiation or provide inadequate 

information to determine whether the 

Federal IDR process applies during the 

open negotiation period. 

a. Determination of Payment Amount 

Through Open Negotiation 

To improve communication and 

information exchange between 

disputing parties and promote 

efficiencies in the Federal IDR process, 

the Departments propose to amend the 

open negotiation provisions of 26 CFR 

54.9816–8(b), 29 CFR 2590.716–8(b), 

and 45 CFR 149.510(b)(1) to impose new 

information exchange requirements and 

processes and to establish a process for 

tracking open negotiations through the 

Federal IDR portal in anticipation of 

initiation of a Federal IDR dispute. 

First, the Departments propose to 

amend paragraph 26 CFR 9816– 

8(b)(1)(i), 29 CFR 2590.716–8(b)(1)(i), 

and 45 CFR 149.510(b)(1)(i) to establish 

a requirement that a party must provide 

a written open negotiation notice to the 

other party and to the Departments 

through the Federal IDR portal to 

initiate the open negotiation period.119

Requiring a party to submit the open 

negotiation notice to the Departments in 

addition to the other party would 

provide a record of whether and when 

the open negotiation period was 

properly initiated, which is essential in 

determining eligibility for the Federal 

IDR process, and would create greater 

transparency among parties engaged in 

open negotiation, the Departments, and 

certified IDR entities. 

Second, the Departments propose to 

amend 26 CFR 54.9816–8(b)(1)(i), 29 

CFR 2590.716–8(b)(1)(i), and 45 CFR 

149.510(b)(1)(i) to specify that the 30- 

business-day open negotiation period 

begins on the day a party first submits 

the open negotiation notice and a copy 

of the initial payment, notice of denial 

of payment, or other remittance advice, 

as specified at proposed 26 CFR 

54.9816–8(b)(1)(ii)(A)(12), 29 CFR 

2590.716–8(b)(1)(ii)(A)(12), and 45 CFR 

149.510(b)(1)(ii)(A)(12), to the other 

party and the Departments through the 

Federal IDR portal. This amendment 

would not change the timeframe for 

engaging in open negotiations but 

would provide greater clarity for parties 

engaged in open negotiation and 

improve the shared understanding of 

deadlines related to the open 

negotiation period. The Departments 

seek comment on these proposed 

amendments. 

b. Open Negotiation Response Notice 

To have a meaningful open 

negotiation, the Departments are of the 

view that both parties must be active 

and responsive participants. The 

Departments’ experience and feedback 

from disputing parties and certified IDR 

entities indicate that the Federal IDR 

process is less efficient overall when 

disputing parties are not engaging with 

each other during the open negotiation 

period. Therefore, the Departments 

propose at 26 CFR 54.9816–8(b)(1)(iii), 

29 CFR 2590.716–8(b)(1)(iii), and 45 

CFR 149.510(b)(1)(iii) to require that the 

party in receipt of the open negotiation 

notice provide a written notice and 

supporting documentation in response 

to the open negotiation notice (open 

negotiation response notice) to the other 

party and the Departments through the 

Federal IDR portal as soon as 

practicable, but no later than the 15th 

business day of the 30-business-day 

open negotiation period. Requiring the 

party in receipt of the open negotiation 

notice to submit an open negotiation 

response notice to both the other party 

and the Departments through the 

Federal IDR portal would help ensure 

that parties are responding to open 

negotiation notices and engaging with 

one another during the open negotiation 

period. To better inform the parties’ 

negotiations, the Departments are 

proposing this 15-business-day 

timeframe to give the party in receipt of 

the open negotiation notice sufficient 

time to review and respond to the open 

negotiation notice. This would also 

allow the party that submitted the open 

negotiation notice to consider, at its 

discretion, the information included in 

the open negotiation response notice 

during (at a minimum) the remaining 15 

business days in the 30-business-day 

open negotiation period. 

These deadlines are intended to 

encourage meaningful participation in 

open negotiations and allow both 

parties time to consider offers and raise 

eligibility concerns prior to initiating 

the Federal IDR process. If a party were 

to fail to furnish an open negotiation 

response notice containing all required 

information to the other party and the 

Departments, the Departments would 

review and determine whether 

enforcement actions may be 

appropriate. However, failure to timely 

furnish an open negotiation response 

notice in any specific open negotiation 

would not extend the open negotiation 

period, delay the timeframe for 

initiation of the Federal IDR process, or 

affect either party’s ability to initiate the 

Federal IDR process. 

The Departments solicit comment on 

the proposed modifications to the 

requirements for submitting the open 

negotiation notice and the newly 

proposed open negotiation response 

notice. Specifically, the Departments 

seek comment on whether the party in 

receipt of the open negotiation notice 

should be required to furnish the open 

negotiation response notice to the other 

party and the Departments earlier than 

proposed to allow additional time for 

the party submitting the open 

negotiation notice to review the open 

negotiation response notice. The 

Departments also seek comment on 

imposing a deadline for the open 


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120Bill type code is the code relevant for billing 

by facilities (as opposed to place of service code for 

providers). 

negotiation response notice later than 

the proposed deadline, including by the 

20th business day or up to the last day 

of the 30-business-day open negotiation 

period. A longer response timeframe 

may be necessary for a party in receipt 

of open negotiation notice to review and 

respond if the party receives a high 

number of open negotiation notices 

within a short time period. However, 

submission of the open negotiation 

response notice at the end of the open 

negotiation period would not provide 

the party that submitted the open 

negotiation notice sufficient time to 

review, consider, and engage with the 

party submitting the open negotiation 

response notice in a meaningful manner 

prior to the deadline for initiation of the 

Federal IDR process. Additionally, the 

Departments seek comment on allowing 

the certified IDR entities, as a means of 

incentivizing participation in the 

proposed exchange of notices, to take 

into consideration a party’s compliance 

with the 15-business-day deadline for 

the open negotiation response notice 

when making their payment 

determinations. 

c. Open Negotiation Notice Content 

The Departments propose to amend 

26 CFR 54.9816–8(b)(1)(ii)(A), 29 CFR 

2590.716–8(b)(1)(ii)(A), and 45 CFR 

149.510(b)(1)(ii)(A) and add 26 CFR 

54.9816–8(b)(1)(ii)(A)(1) through (12), 

29 CFR 2590.716–8(b)(1)(ii)(A)(1) 

through (12), and 45 CFR 

149.510(b)(1)(ii)(A)(1) through (12) to 

require that the open negotiation notice 

include additional information 

regarding the item or service under 

dispute and the party sending the open 

negotiation notice. The proposed 

amendments would add new elements 

and expand the information required on 

the open negotiation notice. 

Under these proposed rules, the 

content elements to identify the item or 

service on the open negotiation notice 

would align with those that the 

Departments propose to require in the 

notice of IDR initiation to identify an 

item or service under dispute as 

specified in 26 CFR 54.9816– 

8(b)(2)(iii)(A), 29 CFR 2590.716– 

8(b)(2)(iii)(A), and 45 CFR 

149.510(b)(2)(iii)(A) and would 

encourage consistency between open 

negotiation and the Federal IDR process. 

The Departments are of the view that 

requiring the additional elements as part 

of the open negotiation notice would 

help parties identify the item or service, 

the reasons for the denial of payment or 

initial payment amount, and whether 

the Federal IDR process applies. Each 

proposed new or amended element on 

the open negotiation notice is described 

in this section, and the Departments’ 

reasoning for the proposed change is 

explained. 

Under current rules, the open 

negotiation notice must include contact 

information for the party sending the 

notice. At proposed paragraphs 26 CFR 

54.9816–8(b)(2)(iii)(A)(1) through (3), 29 

CFR 2590.716–8(b)(2)(iii)(A)(1) through 

(3), and 45 CFR 149.510(b)(1)(ii)(A)(1) 

through (3), the Departments would 

require specific contact information 

sufficient to identify the provider, 

facility, or provider of air ambulance 

services, the plan or issuer, and any 

third party representing the parties in 

the open negotiation. This contact 

information would include legal 

business name, email address, phone 

number, and mailing address, as 

provided with the claim form submitted 

by the provider, facility, or air 

ambulance provider to the plan or 

issuer, which would encourage open 

negotiation initiation between the 

correct parties and effective 

communication of the required 

information. 

In addition to the proposed standard 

contact information elements, parties 

would also be required to include the 

National Provider Identification (NPI) 

number to identify the provider, facility, 

or provider of air ambulance services 

and the IDR registration number, 

assigned under proposed 26 CFR 

54.9816–9, 29 CFR 2590.716–9, and 45 

CFR 149.530, to identify the plan or 

issuer (described further in section II.F. 

of this preamble). 

Providers, facilities, and providers of 

air ambulance services would obtain the 

IDR registration number from the plan 

or issuer when the plan or issuer 

provides it with the initial payment or 

notice of denial of payment. The 

proposed registration number would 

help the provider, facility, or provider of 

air ambulance services to accurately 

identify the plan and issuer with which 

to initiate open negotiation, and the 

contact and plan information necessary 

to initiate open negotiation, particularly 

if the plan or issuer fails to clearly 

disclose such information. Including 

this element on the open negotiation 

notice would streamline the process of 

submitting the open negotiation notice 

by providing a validated source of plan 

and issuer business and contact 

information, which providers, facilities, 

and providers of air ambulance services 

often struggle to identify on 

documentation provided with the initial 

payment or the notice of denial of 

payment and would promote greater 

consistency and accuracy in initiating 

open negotiation with the correct plan 

or issuer. 

The Departments acknowledge, as 

described in section II.F. of this 

preamble, that the plan or issuer may 

not be registered in the IDR registry at 

the time the provider, facility, or 

provider of air ambulance services 

initiates the open negotiation period. In 

these circumstances, the party 

submitting the open negotiation notice 

would attest that the party receiving the 

open negotiation notice was not 

registered prior to the date the party 

submitted its open negotiation notice 

and the registration number would not 

be required to be included in the notice. 

The submitting party would use the 

contact information currently required 

by the disclosure requirements 

established in sections 26 CFR 54.9816– 

6T(d)(1), 29 CFR 2590.716–6(d)(1), and 

45 CFR 149.140(d)(1) with the initial 

payment or notice of denial of payment 

to complete the open negotiation notice. 

Finally, if the party submitting the open 

negotiation notice is a plan or issuer, the 

plan or issuer would be required to 

include the plan type. It is the 

Departments’ view that the plan or 

issuer is best positioned to provide this 

information and that this information is 

necessary in assessing applicability of 

the Federal IDR process. If the plan or 

issuer is not the party initiating open 

negotiation, the plan or issuer would be 

required to include this information on 

the open negotiation response notice 

form, as discussed in section II.D.1.d. of 

this preamble. 

Under the current regulations, the 

open negotiation notice must include 

information sufficient to identify the 

item(s) and service(s) furnished by the 

provider, facility, or provider of air 

ambulance services. These include the 

date(s) the item(s) or service(s) were 

furnished, the service code, and initial 

payment amount, if applicable, an offer 

of an out-of-network rate, and contact 

information for the party sending the 

open negotiation notice. If finalized, 

these proposed rules would add to this 

list of elements considered information 

sufficient to identify the item or service 

and, therefore, required to be included 

in the open negotiation notice at 

proposed paragraphs 26 CFR 54.9816– 

8(b)(1)(ii)(A)(4), 29 CFR 2590.716– 

8(b)(1)(ii)(A)(4), and 45 CFR 

149.510(b)(1)(ii)(A)(4). The proposed 

additions include information to 

identify the location where the item or 

service was furnished (such as place of 

service code or bill type code 120), type 

of item or service, the State where the 

item or service was furnished, and the 


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121See Centers for Medicare & Medicaid Services. 

(December 1, 2021). Place of Service Codes. https:// 

www.cms.gov/Medicare/Coding/place-of-servicecodes#:∼:text=Place%20of%20Service%20Codes

%20are,throughout%20the%20health%20care%20

industry. 

122 Id. 

123There are currently 21 bifurcated States: 

California, Colorado, Connecticut, Delaware, 

Florida, Georgia, Illinois, Maine, Maryland, 

Michigan, Missouri, Nebraska, Nevada, New 

Hampshire, New Jersey, New Mexico, New York, 

Ohio, Texas, Virginia, and Washington. See https:// 

www.cms.gov/files/document/applicability-federalidr-bifurcated-states.pdf. 

124The Departments note that while this 

information may assist parties in preliminarily 

assessing eligibility based on the location of service, 

it would not eliminate the need for the certified IDR 

entity or the Departments to determine whether a 

specified State law applies to the specific item or 

service and provider at issue. 

125U.S. Department of Health and Human 

Services, U.S. Department of Labor, and U.S. 

Department of Treasury. (expiration Nov. 30, 2025). 

Open Negotiation Notice. (OMB Control No. 1210– 

0169). https://www.dol.gov/sites/dolgov/files/ebsa/ 

laws-and-regulations/laws/no-surprises-act/ 

surprise-billing-part-ii-information-collectiondocuments-attachment-2.pdf. 

claim number. The place of service code 

is a two-digit code on health care 

professional claims that indicates the 

setting in which a service was 

furnished.121 Place of service code 

information is often needed to 

determine the acceptability of direct 

billing of Medicare, Medicaid, and 

private insurance services furnished by 

a given provider.122 Further, these 

proposed rules would require the open 

negotiation notice to include the type of 

item or service, including whether the 

item or service is an emergency service 

or a non-emergency service; whether the 

item or service is an air ambulance 

service as defined in 26 CFR 54.9816– 

3T, 29 CFR 2590.716–3, and 45 CFR 

149.30; and whether any service is a 

professional service or a facility-based 

service. Parties engaged in open 

negotiations may use place of service 

code and information on the type of 

item or service to analyze the 

appropriateness of the payment for the 

item or service and the applicability of 

the Federal IDR process. The place of 

service code and type of item or service 

along with the proposed requirement to 

include the State where the item or 

service was furnished would help the 

parties assess whether a specified State 

law or an All-Payer Model Agreement 

might apply. In some States, a specified 

State law or All-Payer Model Agreement 

may apply only to certain items or 

services or with respect to services 

furnished by certain out-of-network 

providers or at certain locations 

(‘‘bifurcated States’’).123

The combination of these 

requirements would help parties 

identify whether the Federal IDR 

process applies or whether an 

applicable specified State law or AllPayer Model Agreement governs the 

out-of-network payment amount. The 

Departments are of the view that 

requiring parties to provide this 

information on the open negotiation 

notice would improve communication 

between parties and help identify and 

resolve differences in their 

understanding of the items or services 

that are the subject of open negotiation. 

Further, the Departments expect that as 

the Federal IDR portal continues to 

evolve, this information may also be 

helpful in providing automatic 

verifications upon a party’s initiation of 

the open negotiation period of eligibility 

for the Federal IDR process, which may 

result in a reduction in submission of 

ineligible items and services.124

Plans and issuers have expressed 

concern that it is often difficult to 

identify the item or service subject to 

the dispute within their billing systems 

without the associated claim number 

provided by the provider, facility, or 

provider of air ambulance services. 

Therefore, the Departments amended 

the standard open negotiation notice to 

include the claim number, as it is 

necessary to identify the item or service 

that is subject of the dispute.125 Under 

these proposed rules, the Departments 

are proposing to codify the requirement 

to include the associated claim number 

in the open negotiation notice. 

At proposed paragraph 26 CFR 

54.9816–8(b)(1)(ii)(A)(5), 29 CFR 

2590.716–8(b)(1)(ii)(A)(5), and 45 CFR 

149.510(b)(1)(ii)(A)(5), the Departments 

would specify that the open negotiation 

notice must include the initial payment 

amount (including $0 if, for example, 

the payment is denied) of the item or 

service subject to the open negotiation. 

The initial payment amount is an 

existing requirement of the open 

negotiation notice, and this proposed 

amendment relocates it to 26 CFR 

54.9816–8(b)(1)(ii)(A)(5), 29 CFR 

2590.716–8(b)(1)(ii)(A)(5), and 45 CFR 

149.510(b)(1)(ii)(A)(5) in the regulatory 

text and clarifies that the plan or issuer 

must specify $0 if payment is denied. 

The Departments propose to add 

paragraph 26 CFR 54.9816– 

8(b)(1)(ii)(A)(6), 29 CFR 2590.716– 

8(b)(1)(ii)(A)(6), and 45 CFR 

149.510(b)(1)(ii)(A)(6) to require a party 

initiating open negotiations to provide 

the QPA for the item or service that is 

the subject of the negotiation if it has 

been provided on the initial payment or 

notice of denial of payment or if the 

party submitting the open negotiation 

notice is a plan or issuer. Similarly, by 

requiring the QPA to be disclosed on the 

open negotiation notice, the 

Departments intend to facilitate better 

communication between parties in 

identifying whether there may be a 

mistake in the identified QPA, such as 

a typographical error or the incorrect 

use of the cost sharing amount rather 

than the QPA, so the information can be 

rectified before initiating the Federal 

IDR process, if applicable. 

At proposed paragraph 26 CFR 

54.9816–8(b)(1)(ii)(A)(7), 29 CFR 

2590.716–8(b)(1)(ii)(A)(7), and 45 CFR 

149.510(b)(1)(ii)(A)(7) the Departments 

would specify that the open negotiation 

notice must include an offer of an outof-network rate for each item or service 

that is the subject of the open 

negotiation. The offer of an out-ofnetwork-rate is an existing requirement 

of the open negotiation notice, and this 

proposed amendment relocates it to new 

paragraph (b)(1)(ii)(A)(7) in the 

regulatory text. 

Under proposed 26 CFR 54.9816– 

8(b)(1)(ii)(A)(8), 29 CFR 2590.716– 

8(b)(1)(ii)(A)(8), and 45 CFR 

149.510(b)(1)(ii)(A)(8) the Departments 

propose to require that if the party 

submitting the open negotiation notice 

is a plan or issuer, it must include the 

amount of cost sharing imposed for the 

item or service, if any. The Departments 

are of the view that the plan or issuer 

is in the best position to provide this 

information since non-participating 

providers, facilities, or providers of air 

ambulance services generally would not 

have access to this information. Because 

the amount of cost sharing for a 

qualified IDR item or service would be 

determined by the QPA amount, 

requiring the amount of cost sharing 

paid or owed by the participant, 

beneficiary, or enrollee could help 

parties better inform their offers while 

negotiating. The amount of cost sharing 

paid or owed by the participant, 

beneficiary, or enrollee would be used, 

along with the prevailing offer to 

calculate the final payment amount, 

should a party choose to initiate the 

Federal IDR process for the item or 

service in question. Having a shared 

understanding of this value and its 

impact on payment during open 

negotiations would support the parties’ 

ability to negotiate with one another in 

good faith. 

A non-emergency item or service is 

ineligible for the Federal IDR process if 

the patient was properly provided 

notice and consented to waive their 

protections from balance billing under 


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126The notice and consent exception does not 

apply to ancillary services, which include items 

and services related to emergency medicine, 

anesthesiology, pathology, radiology, and 

neonatology, whether furnished by a physician or 

non-physician practitioner; items and services 

furnished by assistant surgeons, hospitalists, and 

intensivists; diagnostic services, including 

radiology and laboratory services; and items and 

services furnished by a nonparticipating provider, 

if there is no participating provider who can furnish 

such item or service at such facility. Additionally, 

as specified in PHS Act section 2799B–2(c), the 

notice and consent exception does not apply to 

items or services furnished as a result of 

unforeseen, urgent medical needs that arise at the 

time an item or service is furnished for which a 

nonparticipating provider satisfied the notice and 

consent criteria. 

127See U.S. Department of Health and Human 

Services, U.S. Department of Labor, and U.S. 

Department of the Treasury. (expiration Nov. 30, 

2025). Open Negotiation Notice. (OMB Control No. 

1210–0169). https://www.dol.gov/sites/dolgov/files/ 

ebsa/laws-and-regulations/laws/no-surprises-act/ 

surprise-billing-part-ii-information-collectiondocuments-attachment-2.pdf. 128 86 FR 55991. 

the No Surprises Act.126 To reduce the 

number of Federal IDR process disputes 

initiated for items or services that are 

ineligible for this reason, the 

Departments propose to require at new 

26 CFR 54.9816–8(b)(1)(ii)(A)(9), 29 CFR 

2590.716–8(b)(1)(ii)(A)(9), and 45 CFR 

149.510(b)(1)(ii)(A)(9) that if the party 

submitting the open negotiation notice 

is a provider or facility, that party must 

provide a statement that the items and 

services do not qualify for the notice 

and consent exception described at 45 

CFR 149.410(b) or 149.420(c) through 

(i), either because the items and services 

are subject to the prohibition on balance 

billing without exception or because the 

provider or facility did not provide 

notice and receive consent. 

To further reduce the number of 

Federal IDR disputes initiated for 

ineligible items or services, the 

Departments propose at 26 CFR 

54.9816–8(b)(1)(ii)(A)(10), 29 CFR 

2590.716–8(b)(1)(ii)(A)(10), and 45 CFR 

149.510(b)(1)(ii)(A)(10) to require that 

the party submitting the open 

negotiation notice provide a statement 

that the provider, facility, or provider of 

air ambulance services was a 

nonparticipating provider, facility, or 

provider of air ambulance services on 

the date the item or service was 

furnished. Identification of this 

eligibility factor at open negotiation may 

decrease the number of ineligible 

disputes initiated by drawing the 

attention of the parties to the statutory 

eligibility standards underlying the 

Federal IDR process. 

Currently, the standard form 127 for 

the open negotiation notice provided by 

the Departments contains general 

information including a description of 

the open negotiation period, what 

happens at the end of the open 

negotiation period, and the Federal IDR 

process. The Departments propose at 26 

CFR 54.9816–8(b)(1)(ii)(A)(11), 29 CFR 

2590.716–8(b)(1)(ii)(A)(11), and 45 CFR 

149.510(b)(1)(ii)(A)(11) to align the 

general information requirements for the 

open negotiation notice with existing 

requirements under the October 2021 

interim final rules regarding the notice 

of IDR initiation, which specify that the 

notice of IDR initiation must include a 

statement describing the Federal IDR 

process and general information to help 

ensure that the non-initiating party is 

informed about the process and is 

familiar with the next steps.128

To support the identification of items 

or services ineligible for the Federal IDR 

process, the Departments propose to 

require the party submitting the open 

negotiation notice to provide a copy of 

the initial payment or notice of denial 

of payment or other remittance advice 

that is required to include the proposed 

CARC and RARC disclosures described 

in section II.B. of this preamble at 

proposed 26 CFR 54.9816– 

8(b)(1)(ii)(A)(12), 29 CFR 2590.716– 

8(b)(1)(ii)(A)(12), and 45 CFR 

149.510(b)(1)(ii)(A)(12). The remittance 

advice containing the proposed CARC 

and RARC disclosures would provide 

information as to whether the plan or 

issuer believes the claim is eligible for 

the Federal IDR process and ensure that 

a provider initiating open negotiation 

understands the position of the plan or 

issuer regarding the eligibility of an item 

or service, even in situations in which 

a plan or issuer in receipt of an open 

negotiation notice is not otherwise 

responsive. 

The Departments seek comment on 

the addition of these proposed required 

elements to the open negotiation notice. 

The Departments also solicit comment 

on whether the party submitting the 

open negotiation notice should be 

required to provide a statement 

describing why the party is initiating 

the open negotiation period, including 

any considerations that serve as the 

basis for the initiation of open 

negotiation for the item or service, such 

as any of the considerations currently 

described in 26 CFR 54.9816– 

8T(c)(4)(iii) and 54.9817–2T(b)(2), 29 

CFR 2590.716–8(c)(4)(iii) and 2590.717– 

2(b)(2), and 45 CFR 149.510(c)(4)(iii) 

and 149.520(b)(2). 

d. Open Negotiation Response Notice 

Content 

The Departments propose to establish 

requirements for an open negotiation 

response notice at 26 CFR 54.9816– 

8(b)(1)(iii)(A), 29 CFR 2590.716– 

8(b)(1)(iii)(A), and 45 CFR 

149.510(b)(1)(iii)(A). Specifically, the 

Departments propose to require that the 

party receiving an open negotiation 

notice must provide a response to the 

open negotiation notice, which would 

include the same information specified 

in proposed 26 CFR 54.9816– 

8(b)(1)(ii)(A)(1) through (3), 29 CFR 

2590.716–8(b)(1)(ii)(A)(1) through (3), 

and 45 CFR 149.510(b)(1)(ii)(A)(1) 

through (3) related to the requirements 

to provide contact information sufficient 

to identify the provider, facility, or 

provider of air ambulance services, the 

plan or issuer that are parties to the 

open negotiation, and any third party 

representing a party in the open 

negotiation. The Departments further 

propose that the open negotiation 

response notice would include the 

following additional information under 

proposed 26 CFR 54.9816– 

8(b)(1)(iii)(A)(4) through (11), 29 CFR 

2590.716–8(b)(1)(iii)(A)(4) through (11), 

and 45 CFR 149.510(b)(1)(iii)(A)(4) 

through (11): (4) information sufficient 

to identify the item or service included 

in the open negotiation notice, 

including the date(s) the item or service 

was furnished, the claim number, and if 

the party in receipt of the open 

negotiation notice is a provider, facility, 

or provider of air ambulance services, 

the date(s) that the provider, facility, or 

provider of air ambulance services 

received the initial payment or notice of 

denial of payment for such item or 

service from the plan or issuer; (5) if the 

party in receipt of the open negotiation 

notice is a plan or issuer, a statement as 

to whether it agrees that the initial 

payment amount (including $0 if, for 

example, payment is denied) and the 

QPA reflected in the open negotiation 

notice accurately reflects the initial 

payment amount and QPA disclosed 

with the initial payment for the item or 

service, and if not, the initial payment 

amount (including $0 if, for example, 

payment is denied) and/or the QPA it 

believes to be correct and 

documentation to support the statement 

(for example, the remittance advice 

confirming the QPA amount); (6) if the 

party in receipt of the open negotiation 

notice is a plan or issuer, the amount of 

cost sharing imposed for the item or 

service, if any; (7) a counteroffer of an 

out-of-network rate for each item or 

service or an acceptance of the other 

party’s offer; (8) if the party in receipt 

of the open negotiation notice is a 

provider or facility, a statement that the 

items and services do not qualify for the 

notice and consent exception described 

at 45 CFR 149.410(b) or 149.420(c) 

through (i); (9) with respect to each item 


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or service, a statement and supporting 

documentation that explains why the 

item or service is ineligible for the 

Federal IDR process or a statement 

agreeing that the item or service is 

eligible for the Federal IDR process; (10) 

a statement as to whether any of the 

information provided in the open 

negotiation notice is inaccurate and the 

basis for the statement, as well as 

supporting documentation; and (11) a 

statement confirming that the initial 

payment or notice of denial of payment 

or other remittance advice provided by 

the party submitting the open 

negotiation notice is accurate, and if 

inaccurate, a copy of the accurate initial 

payment or notice of denial of payment 

or other remittance advice that is 

required to include the disclosures 

under 26 CFR 54.9816–6T(d)(1), 26 CFR 

54.9816–6(d)(1), 29 CFR 2590.716– 

6(d)(1), and 45 CFR 149.140(d)(1), with 

respect to the item or service. 

Based on feedback from the certified 

IDR entities, non-initiating parties often 

do not object to the applicability of the 

Federal IDR process or to the accuracy 

of the QPA until after the certified IDR 

entity has been selected, including at 

the time of offer submission. Also, at 

times, disputing parties disagree about 

the accuracy of information relevant to 

the claim under dispute. In these cases, 

the initiating party is unaware of the 

non-initiating party’s statement because 

this information is sent to the certified 

IDR entity and not to the initiating party 

well after the open negotiation period 

has ended. This significantly slows 

down the processing of disputes, as the 

certified IDR entity then must contact 

both parties to determine the 

appropriate QPA or solicit information 

necessary to confirm the Federal IDR 

process applies. To implement an 

efficient Federal IDR process, both 

parties must be active participants in 

the process. For this reason, and to 

minimize communication challenges 

between parties, the Departments are of 

the view that the party in receipt of the 

open negotiation notice should provide 

the proposed content elements to the 

party sending the open negotiation 

notice and to the Departments. All of 

the proposed open negotiation response 

notice content requirements are also 

included in the proposed open 

negotiation notice content requirements, 

except for: (1) a statement that explains 

why the item or service is not subject to 

the Federal IDR process or a statement 

agreeing that the item or service is 

subject to the Federal IDR process; (2) a 

statement as to whether the QPA 

reflected in the open negotiation notice 

is accurate for the item or service, and 

if not, a statement providing the QPA it 

believes to be correct and 

documentation to support the statement 

(for example, the remittance advice 

confirming the QPA amount); and (3) a 

statement confirming the accuracy of 

the initial payment, notice of denial of 

payment, or other remittance advice 

provided by the party submitting the 

open negotiation notice, and a copy of 

an accurate initial payment, notice of 

denial of payment or other remittance 

advice if inaccurate. By restating 

information on both the open 

negotiation notice and open negotiation 

response notice, parties would have an 

opportunity to confirm or update 

information necessary to negotiate and 

identify any information discrepancies 

which could impact eligibility and 

decisions to negotiate or participate in 

the Federal IDR process. With respect to 

the three proposed open negotiation 

response notice content requirements 

not included in the open negotiation 

notice, this proposal, if finalized, would 

make the party submitting the open 

negotiation notice aware of any 

objection that the party in receipt of the 

open negotiation notice has to the 

dispute’s eligibility for the Federal IDR 

process or its objection to the QPA or 

remittance advice accuracy. 

Additionally, this proposal would 

require the party in receipt of the open 

negotiation notice to provide an 

explanation and documentation to 

support its statement(s). 

The Departments are of the view that 

this proposed method of exchanging 

information would facilitate 

communication and understanding 

between the parties as to the eligibility 

of an item or service for the Federal IDR 

process. The Departments seek 

comment on the content elements of the 

open negotiation response notice. The 

Departments also seek comment on the 

requirement to submit a counteroffer for 

an out-of-network rate for the item or 

service or a statement accepting the 

other party’s offer on the open 

negotiation response notice. 

Specifically, the Departments seek 

comment on whether it would hinder 

meaningful negotiation between the 

parties outside the Federal IDR portal, 

or whether it would promote 

negotiation among parties that might 

otherwise not negotiate. 

e. Technical Amendments 

The Departments propose several 

technical amendments to the open 

negotiation regulatory text. These 

proposed changes correct or remove 

regulatory text that is being updated by 

the open negotiation proposals in these 

proposed rules. First, the Departments 

propose a technical correction for the 

cross reference at 26 CFR 54.9816– 

8T(b)(1)(i), 29 CFR 2590.716–8(b)(1)(i), 

and 45 CFR 149.510(b)(1)(i) which 

directs readers to the definition of a 

qualified IDR item or service at 

paragraph (a)(2)(xii)(A), but should 

instead reference paragraph (a)(2)(xi)(A) 

for the appropriate cross reference to the 

definition of a qualified IDR item or 

service. 

Second, the Departments propose to 

remove the current regulatory text that 

describes the manner in which the open 

negotiation notice must be provided. 

The requirements for submitting the 

open negotiation notice described in 

paragraphs 26 CFR 54.9816– 

8T(b)(1)(ii)(B), 29 CFR 2590.716– 

8(b)(1)(ii)(B), and 45 CFR 

149.510(b)(1)(ii)(B) would be removed 

because they would no longer apply 

under the proposed changes to the open 

negotiation notice, and the removal of 

this paragraph aligns with the proposal 

described at section II.D.3. of this 

preamble, which would establish 

uniform standards for submitting 

notices for both open negotiations and 

the IDR initiation through the Federal 

IDR portal. 

f. Implementation of Open Negotiation 

Through the Federal IDR Portal 

As discussed in section II.D.3. of this 

preamble, to implement the proposed 

modifications to the requirements for 

submitting the open negotiation notice 

and the newly proposed open 

negotiation response notice, the 

Departments would need to modify the 

Federal IDR portal to allow parties to 

send the open negotiation notice and 

open negotiation response notice to the 

other party and the Departments 

through the Federal IDR portal. While 

some plans or issuers have created their 

own proprietary portals to facilitate 

open negotiations, providers, facilities, 

and providers of air ambulance services 

are not required to use them. 

Accordingly, providers and facilities are 

not considered to have failed to provide 

an open negotiation notice or open 

negotiation response notice solely 

because they did not use a plan’s or 

issuer’s proprietary portal. The 

Departments are of the view that having 

one central location where plans, 

issuers, providers, facilities, and 

providers of air ambulance services 

could initiate open negotiations would 

increase efficiency. Plans, issuers, 

providers, facilities, providers of air 

ambulance services, and certified IDR 

entities have also requested that the 

Departments amend the rules to require 

parties to send the open negotiation 

notice through the Federal IDR portal to 


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129 86 FR 55991. 

130See proposed regulations for the open 

negotiation notice content at: 26 CFR 54.9816– 

8(b)(1)(ii)(A)(1)–(6) and (9)–(12); 29 CFR 2590.716– 

8(b)(1)(ii)(A)(1)–(6) and (9)–(12); and 45 CFR 

149.510(b)(1)(ii)(A)(1)–(6) and (9)–(12). See 

proposed regulations for the open negotiation 

response content at: 26 CFR 54.9816– 

8(b)(1)(iii)(A)(1)–(4), (8), and (11); 29 CFR 

2590.716–8(b)(1)(iii)(A)(1)–(4), (8), and (11); and 45 

CFR 149.510(b)(1)(iii)(A)(1)–(4), (8) and (11). 

streamline the process and create a 

centralized platform where parties can 

better track their open disputes. The 

Departments note that though these 

rules propose to require the open 

negotiation notice and the open 

negotiation response notice to be 

submitted through the Federal IDR 

portal, parties would not be required to 

conduct negotiations within the Federal 

IDR portal. 

The Federal IDR portal would 

facilitate transmittal of the open 

negotiation notice to the appropriate 

party. Specifically, if the party receiving 

the open negotiation notice is a 

provider, facility, or provider of air 

ambulance services, the Federal IDR 

portal would transmit the notice to the 

party based on the contact information 

provided in the open negotiation notice. 

However, if the party in receipt of the 

open negotiation notice is a plan or 

issuer, the Federal IDR portal would 

transmit the notice to the party based on 

the contact information provided 

through the IDR registry. As discussed 

in sections II.D.1.c. and II.F. of these 

proposed rules, it is possible that a plan 

or issuer would not have submitted 

their information to the registry by the 

time a party submits an open 

negotiation notice to them. If, at the 

time the open negotiation notice is 

submitted there is not a registration 

number for the plan or issuer, the 

Federal IDR portal would transmit the 

notice to the party based on the contact 

information provided in the open 

negotiation notice. 

The Departments seek comment on 

whether the disputing parties should be 

required to use the Federal IDR portal 

for further communication related to 

open negotiations beyond the initiation 

of open negotiation and the submission 

of the open negotiation response notice. 

The Departments seek comment on 

what modes of correspondence might be 

useful to the parties during the open 

negotiation period (for example, the 

submission of additional documentation 

to the other party, live chat, or message 

exchange, etc.) and if the content of 

those communications should be 

accessible to the certified IDR entities if 

a dispute is initiated on the relevant 

item or service. Lastly, the Departments 

solicit comment on whether there are 

any additional challenges preventing 

the parties from, or clarifications needed 

to assist the parties in, fully engaging in 

meaningful negotiations during the 

open negotiation period. 

2. Changes to the Initiation of the 

Federal IDR Process 

Section 9816(c)(1)(B) of the Code, 

section 716(c)(1)(B) of ERISA, section 

2799A–1(c)(1)(B) of the PHS Act, and 

the October 2021 interim final rules 

establish that, with respect to items or 

services that are the subject of an open 

negotiation period, if the parties have 

not agreed upon an amount for the outof-network rate by the last day of the 

open negotiation period, either party 

may initiate the Federal IDR process 

during the 4-business-day period 

beginning on the 31st business day after 

the start of the open negotiation 

period.129

a. Notice of IDR Initiation 

As discussed in section II.D.1. of this 

preamble, an efficient and transparent 

Federal IDR process requires both 

parties to be active participants. 

Therefore, the Departments propose to 

amend the IDR initiation provisions of 

26 CFR 54.9816–8(b)(2), 29 CFR 

2590.716–8(b)(2), and 45 CFR 

149.510(b)(2) to improve 

communication between parties, 

accelerate dispute processing, and 

reduce the burden on certified IDR 

entities when determining whether a 

case is eligible for the Federal IDR 

process. Specifically, these proposed 

rules would require the initiating party 

to include additional information in the 

notice of IDR initiation and would 

require non-initiating parties to provide 

a response to the notice of IDR initiation 

(notice of IDR initiation response) to the 

Departments and to the initiating party 

through the Federal IDR portal within 3 

business days of receipt of the notice of 

IDR initiation. Section II.D.3. of this 

preamble describes how the parties 

would provide both the notice of IDR 

initiation and notice of IDR initiation 

response to the other party and the 

Departments. 

The Departments propose to amend 

the content of the notice of IDR 

initiation and redesignate proposed 26 

CFR 54.9816–8(b)(2)(iii)(A), 29 CFR 

2590.716–8(b)(2)(iii)(A), and 45 CFR 

149.510(b)(2)(iii)(A) as 26 CFR 54.9816– 

8(b)(2)(ii)(A), 29 CFR 2590.716– 

8(b)(2)(ii)(A), and 45 CFR 

149.510(b)(2)(ii)(A). As described in 

section II.D.1.c. of this preamble, under 

these proposed rules several of the 

content elements in the notice of IDR 

initiation would be required in the open 

negotiation notice and open negotiation 

response notice.130 As discussed in 

section II.D.1.d. of this preamble, by 

restating information on the notices, 

parties would have an opportunity to 

confirm or update information 

necessary to continue negotiations and 

identify any information discrepancies 

that could impact eligibility for the 

Federal IDR process. Further, the open 

negotiation notice and notice of IDR 

initiation would often not be identical 

since disputing parties do not always 

decide to initiate the Federal IDR 

process for all items and services 

included in the open negotiation notice. 

The Departments anticipate that the 

Federal IDR portal would be able to 

prepopulate information included in the 

open negotiation notices and open 

negotiation response notices, which 

would mitigate additional burden on the 

disputing parties and would provide the 

certified IDR entity (or the Departments 

in the event the departmental eligibility 

review applies as described in section 

II.E.1.b.ii. of these proposed rules) 

sufficient information with respect to 

the item or service and dispute in a 

single document. 

Under current rules, the notice of IDR 

initiation must include contact 

information for the parties to the 

dispute. The proposed rules under 26 

CFR 54.9816–8(b)(2)(ii)(A)(1) through 

(3), 29 CFR 2590.716–8(b)(2)(ii)(A)(1) 

through (3), and 45 CFR 

149.510(b)(2)(ii)(A)(1) through (3), 

would require specific contact 

information depending on whether the 

initiating party is a provider, facility, or 

provider of air ambulance services, or 

the plan or issuer, as well as any third 

party representing the initiating party in 

the dispute. This contact information 

would include the legal business name, 

email address, phone number, mailing 

address, and Tax Identification Number 

(TIN). The initiating party would also be 

required to include the NPI to identify 

the provider, facility, or provider of air 

ambulance services and the plan or 

issuer IDR registration number, assigned 

under proposed 26 CFR 54.9816–9, 29 

CFR 2590.716–9, and 45 CFR 149.530 to 

identify the plan or issuer, if the plan or 

issuer is registered, or an attestation 

from the initiating party that the plan or 

issuer was not registered prior to the 

date of the notice (described further in 

section II.F. of this preamble). Further, 

if there is any third party representing 

the initiating party, the notice of IDR 

initiation would be required to include 

an attestation that the third party has 

the authority to act on behalf of the 


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131Proposed 26 CFR 54.9816–8(b)(2)(ii)(A)(3), 29 

CFR 2590.716–8(b)(2)(ii)(A)(3), and 45 CFR 

149.510(b)(2)(ii)(A)(3). 

132Proposed 26 CFR 54.9816–8(b)(2)(ii)(A)(4), 29 

CFR 2590.716–8(b)(2)(ii)(A)(4), and 45 CFR 

149.510(b)(2)(ii)(A)(4). 

133Proposed 26 CFR 54.9816–8(b)(2)(ii)(A)(5), 29 

CFR 2590.716–8(b)(2)(ii)(A)(5), and 45 CFR 

149.510(b)(2)(ii)(A)(5). 

134Currently, the administrative fee is paid to the 

selected certified IDR entity and then remitted to 

the Departments. 26 CFR 54.9816–8T(d)(2)(i) and 

(e)(2)(ix), 29 CFR 2590.716–8(d)(2)(i) and (e)(2)(ix), 

and 45 CFR 149.510(d)(2)(i) and (e)(2)(ix). 

135Proposed 26 CFR 54.9816–8(b)(2)(ii)(A)(9), 29 

CFR 2590.716–8(b)(2)(ii)(A)(9), and 45 CFR 

149.510(b)(2)(ii)(A)(9). 

136Proposed 26 CFR 54.9816–8(b)(2)(ii)(A)(10) 

through (11) and (13), 29 CFR 2590.716– 

8(b)(2)(ii)(A)(10) through (11) and (13), and 45 CFR 

149.510(b)(2)(ii)(A)(10) through (11) and (13). 

137Proposed 26 CFR 54.9816–8(b)(2)(ii)(A)(12), 

29 CFR 2590.716–8(b)(2)(ii)(A)(12), and 45 CFR 

149.510(b)(2)(ii)(A)(12). 

138Proposed 26 CFR 54.9816–8(b)(2)(ii)(A)(14), 

29 CFR 2590.716–8(b)(2)(ii)(A)(14), and 45 CFR 

149.510(b)(2)(ii)(A)(14). 

party it represents in the Federal IDR 

process.131

Under current rules, the notice of IDR 

initiation must also include information 

sufficient to identify the items or 

services that are the subject of the 

dispute. These proposed rules would 

amend these requirements to include 

whether the dispute being initiated 

includes batched or bundled qualified 

IDR items or services 132 (described in 

section II.E.2. of this preamble); the 

date(s) the qualified IDR item or service 

was furnished; if the initiating party is 

a provider, facility, or provider of air 

ambulance services, the date(s) that the 

provider, facility, or provider of air 

ambulance services received the initial 

payment or notice of denial of payment 

for such item or service from the plan 

or issuer; the date the open negotiation 

period began; the type of item or 

service; the State where the item or 

service was furnished; the claim 

number; the service code; and 

information to identify the location the 

item or service was furnished (including 

the place of service code or bill type 

code).133 The proposed rule requiring 

plans and issuers to provide the claim 

number in the notice of IDR initiation 

would codify existing content 

requirements in the notice of IDR 

initiation. The claim number is an 

element on the notice of IDR initiation 

that is currently approved for use by the 

initiating party, as it is information that 

is necessary to identify the item or 

service under dispute, as currently 

required by 26 CFR 54.9816– 

8T(b)(2)(iii)(A)(1), 29 CFR 2590.716– 

8(b)(2)(iii)(A)(1), and 45 CFR 

149.510(b)(2)(iii)(A)(1). The 

Departments also propose requiring the 

initiating party to submit its TIN in the 

notice of IDR initiation in order to 

facilitate the Departments’ ability to 

collect the administrative fees directly, 

as described in section II.E.3.d. of this 

preamble.134 The TIN would also 

facilitate debt collection from parties 

that fail to pay their administrative fees 

and generally streamline the collection 

process by serving as a unique identifier 

for disputing parties. 

Under current rules, the notice of IDR 

initiation requires the initiating party to 

provide the initial payment amount, the 

QPA, and if the initiating party is a 

provider or facility, a statement that the 

items and services do not qualify for the 

notice and consent exception described 

at 45 CFR 149.410(b) or 149.420(c) 

through (i). This information would still 

be required under these proposed rules 

at paragraphs 26 CFR 54.9816– 

8(b)(2)(ii)(A)(6) through (8), 29 CFR 

2590.716–8(b)(2)(ii)(A)(6) through (8), 

and 45 CFR 149.510(b)(2)(ii)(A)(6) 

through (8), but would require the QPA 

only if provided with the initial 

payment of notice of denial or payment 

or if the initiating party is a plan or 

issuer. These proposed rules would also 

require that the initiating party provide 

the initial payment amount, including 

$0, if the payment was denied. 

Further, these proposed rules would 

require a statement that the provider, 

facility, or provider of air ambulance 

services was a nonparticipating 

provider, nonparticipating emergency 

facility, or nonparticipating provider of 

air ambulance services on the date the 

item or service was furnished.135 As 

discussed in section II.D.1.c. of this 

preamble, identification of this 

eligibility factor at the time of initiating 

the Federal IDR process may decrease 

the number of ineligible disputes 

initiated by drawing the attention of the 

parties to the statutory eligibility 

standards underlying the Federal IDR 

process. 

Under current rules, the notice of IDR 

initiation requires the initiating party to 

provide an attestation that the item or 

service under dispute is a qualified IDR 

item or service, and the basis for the 

attestation; general information listed in 

the standard notice of IDR initiation 

developed by the Departments 

describing the Federal IDR process 

(including a description of the purpose 

of the Federal IDR process and key 

deadlines in the Federal IDR process); 

and the preferred certified IDR entity. 

Each of these content requirements 

would still be required under these 

proposed rules.136

To improve communications between 

the parties to a dispute, these proposed 

rules would also require the initiating 

party to include a copy of the initial 

payment or notice of denial of payment 

or other remittance advice that is 

required to include the disclosures 

under 26 CFR 54.9816–6T(d)(1), 26 CFR 

54.9816–6(d)(1), 29 CFR 2590.716– 

6(d)(1), and 45 CFR 149.140(d)(1), with 

respect to the item or service; 137 and a 

statement describing the key aspects of 

the claim discussed by the parties 

during open negotiation that relate to 

the payment for the disputed claim, 

whether the reasons for initiating the 

Federal IDR process are different from 

those aspects discussed during the open 

negotiation period, and an explanation 

of why the party is initiating the Federal 

IDR process, including any of the 

considerations currently described in 26 

CFR 54.9816–8(c)(4)(iii) and 54.9817– 

2(b)(2), 29 CFR 2590.716–8(c)(4)(iii) and 

2590.717–2(b)(2), and 45 CFR 

149.510(c)(4)(iii) and 149.520(b)(2) that 

serve as the party’s basis for initiating 

the Federal IDR process.138 The 

Departments have received feedback 

that plans and issuers are often unaware 

of the reasons why the provider, facility, 

or provider of air ambulance services is 

initiating the Federal IDR process, 

despite engaging in the 30-business-day 

open negotiation period. Further, plans 

and issuers have stated that providers, 

facilities, and providers of air 

ambulance services often raise different 

reasons in the notice of offer submission 

than the reasons they presented during 

the open negotiation period. Plans and 

issuers have also stated that if they 

knew earlier of a provider’s, facility’s, or 

provider of air ambulance services’ 

reasoning for initiating the Federal IDR 

process, they may have a more accurate 

basis for making an alternative out-ofnetwork payment amount that may 

better align with the provider’s, 

facility’s, or provider of air ambulance 

services’ requested total payment 

amount. Thus, the Departments are of 

the view that requiring this information 

would result in the non-initiating party 

providing a more informed offer or help 

the disputing parties reach a settlement 

before the certified IDR entity makes a 

payment determination. 

Requiring the initiating party to attest 

that the item or service under dispute is 

a qualified IDR item or service and to 

identify the basis for the attestation may 

reduce the number of ineligible disputes 

submitted because it would require the 

initiating party to actively evaluate 

eligibility before initiating the Federal 

IDR process. This would help reduce 

the time certified IDR entities spend 

conducting outreach to confirm whether 


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139See proposed regulations for the open 

negotiation notice content at: 26 CFR 54.9816– 

8(b)(1)(ii)(A)(1)–(6), (8)–(9), and (12); 29 CFR 

2590.716–8(b)(1)(ii)(A)(1)–(6), (8)–(9), and (12); and 

45 CFR 149.510(b)(1)(ii)(A)(1)–(6), (8)–(9), and (12). 

See proposed regulations for the open negotiation 

response content at: 26 CFR 54.9816– 

8(b)(1)(iii)(A)(1)–(6), (8)–(9), and (11); 29 CFR 

2590.716–8(b)(1)(iii)(A)(1)–(6), (8)–(9), and (11); and 

45 CFR 149.510(b)(1)(iii)(A)(1)–(6), (8)–(9), and (11). 

See proposed regulations for the notice of IDR 

initiation content at: 26 CFR 54.9816– 

8(b)(2)(ii)(A)(1)–(3), (5)–(8), (10), and (12); 29 CFR 

2590.716–8(b)(2)(ii)(A)(1)–(3), (5)–(8), (10), and (12); 

and 45 CFR 149.510(b)(2)(ii)(A)(1)–(3), (5)–(8), (10) 

and (12). 

the item or service is eligible for the 

Federal IDR process. 

Lastly, the Departments propose to 

remove paragraphs 26 CFR 54.9816– 

8T(b)(2)(iii)(B) and (C), 29 CFR 

2590.716–8(b)(2)(iii)(B) and (C), and 45 

CFR 149.510(b)(2)(iii)(B) and (C), which 

specify the manner in which the notice 

of IDR initiation must be provided to the 

other party and the Departments. The 

Departments propose to establish 

paragraphs 26 CFR 54.9816–8(b)(3), 29 

CFR 2590.716–8(b)(3), and 45 CFR 

149.510(b)(3) to require use of the 

Federal IDR portal for transmission of 

notices of IDR initiation in the same 

manner as would be required for the 

transmission of notices related to open 

negotiation discussed in section II.D.3. 

of this preamble. 

The Departments seek comment on 

these proposals. Specifically, the 

Departments seek comment on the new 

content elements for the notice of IDR 

initiation and whether additional 

elements should be required to facilitate 

the exchange of information necessary 

to initiate the Federal IDR process. 

Further, the Departments solicit 

comment on the proposed requirement 

for the initiating party to include in the 

notice of IDR initiation a statement 

describing any key aspects of the claim 

discussed by the parties during open 

negotiation, whether the considerations 

for initiating the Federal IDR process are 

different from the key aspects of the 

claim discussed during the open 

negotiation period, and an explanation 

of why the party is initiating the Federal 

IDR process, including any of the 

permissible considerations described at 

26 CFR 54.9816–8(c)(4)(iii) and 

54.9817–2(b)(2), 29 CFR 2590.716– 

8(c)(4)(iii) and 2590.717–2(b)(2), and 45 

CFR 149.510(c)(4)(iii) and 149.520(b)(2). 

b. Notice of IDR Initiation Response 

The Departments propose to amend 

26 CFR 54.9816–8(b)(2)(i), 29 CFR 

2590.716–8(b)(2)(i), and 45 CFR 

149.510(b)(2)(i) to require that the noninitiating party provide a written notice 

and supporting documentation in 

response to the notice of IDR initiation 

to the initiating party and the 

Departments within 3 business days 

after the date of IDR initiation. As 

described in section II.D.2.a. of this 

preamble, the initiating party must 

submit the notice of IDR initiation 

through the Federal IDR portal. Upon 

proper submission of the notice of IDR 

initiation by the initiating party, the 

Federal IDR portal would facilitate 

transmittal of the notice of IDR 

initiation to the non-initiating party. 

The non-initiating party would also 

receive the notice of IDR initiation 

response form from the Federal IDR 

portal on the date of IDR initiation, 

which is the date the Departments 

receive the notice of IDR initiation. The 

Departments are of the view that it is 

critical to require the non-initiating 

party to provide a response to the notice 

of IDR initiation (including any 

objections regarding preferred certified 

IDR entity selection and notice of any 

objection to Federal IDR process 

eligibility) in order to increase 

transparency and improve efficiencies 

in the Federal IDR process. 

The Departments propose to add 26 

CFR 54.9816–8(b)(2)(iii)(A), 29 CFR 

2590.716–8(b)(2)(iii)(A), and 45 CFR 

149.510(b)(2)(iii)(A), to provide that the 

notice of IDR initiation response must 

include information sufficient to 

identify the non-initiating party. Under 

the proposed rules, the notice of IDR 

initiation response must include the 

legal business name, email address, 

phone number, mailing address, the 

TIN, the NPI, and the plan’s or issuer’s 

registration number, as required under 

proposed 26 CFR 54.9816–9, 29 CFR 

2590.716–9, and 45 CFR 149.530. These 

proposed rules would also require the 

notice to include the name and contact 

information (including the legal 

business name, email address, phone 

number, and mailing address) for any 

third party representing the noninitiating party, and an attestation that 

the third party has the authority to act 

on behalf of the party it represents in 

the Federal IDR process. 

The Departments also propose that 

the notice must include information 

sufficient to identify each item or 

service included in the notice of IDR 

initiation (including the date(s) the item 

or service was furnished. If the noninitiating party is a provider, facility, or 

provider of air ambulance services, the 

notice must include the date(s) that the 

provider, facility, or provider of air 

ambulance services received the initial 

payment or notice of denial of payment 

for such item or service from the plan 

or issuer and the claim number). If the 

non-initiating party is a plan or issuer, 

the proposed rules would require a 

statement as to whether the noninitiating party agrees that the initial 

payment (including $0 if, for example, 

payment is denied) and the QPA 

reflected in the notice of IDR initiation 

was the initial payment amount and/or 

the QPA disclosed with the initial 

payment or notice of denial of payment 

for the item or service that is the subject 

of the dispute, and if not, the initial 

payment amount (including $0 if, for 

example, payment is denied) and/or 

QPA it believes to be correct, and 

documentation to support the statement 

(for example, the remittance advice 

confirming the QPA). If the noninitiating party is a plan or issuer, the 

notice must include the amount of cost 

sharing imposed for the item or service, 

if any. If the non-initiating party is a 

provider or facility, the notice must 

include a statement that the items and 

services do not qualify for the notice 

and consent exception described at 

§ 149.410(b) or § 149.420(c) through (i). 

With respect to each item or service 

that is the subject of the dispute, the 

notice must also include an attestation 

that the item or service is a qualified 

IDR item or service, or for each item or 

service that the non-initiating party 

asserts is not a qualified IDR item or 

service, an explanation and 

documentation to support the statement; 

a statement confirming that the initial 

payment or notice of denial of payment 

or other remittance advice provided by 

the initiating party under paragraph 

(b)(2)(ii)(A)(12) is accurate, and if 

inaccurate, a copy of the accurate initial 

payment or notice of denial of payment 

or other remittance advice required to 

include the disclosures under 26 CFR 

54.9816–6T(d)(1), 26 CFR 54.9816– 

6(d)(1), 29 CFR 2590.716–6(d)(1), and 45 

CFR 149.140(d)(1), with respect to the 

item or service; a statement as to 

whether any of the information 

provided in the notice of IDR initiation 

is inaccurate, the basis for the statement, 

and any supporting documentation; and 

a statement as to whether the noninitiating party agrees or objects to the 

initiating party’s preferred certified IDR 

entity. If the non-initiating party objects 

to the initiating party’s preferred 

certified IDR entity, the notice of IDR 

initiation response must include the 

name of an alternative preferred 

certified IDR entity and, if applicable, 

an explanation of any conflict of interest 

with the initiating party’s preferred 

certified IDR entity. 

Most of the proposed notice of IDR 

initiation response content requirements 

are included in the proposed open 

negotiation notice, open negotiation 

response notice, and notice of IDR 

initiation content requirements.139 As 


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140 86 FR 55990. 

141 26 CFR 54.9816–8T(b)(1)(ii)(B), (b)(2)(iii)(B), 

and (b)(2)(iii)(C), 29 CFR 2590.716–8(b)(1)(ii)(B), 

(b)(2)(iii)(B), and (b)(2)(iii)(C), and 45 CFR 

149.510(b)(1)(ii)(B), (b)(2)(iii)(B) and (b)(2)(iii)(C). 142 86 FR 55990 through 55991. 

discussed in sections II.D.1.d. and 

II.D.2.a., by restating information on the 

notices, parties would have an 

opportunity to confirm or update 

information necessary to continue 

negotiations and identify any 

information discrepancies which could 

impact eligibility. Further, by requiring 

this information at IDR initiation, it 

would reduce the likelihood that 

additional outreach would be necessary 

to make eligibility determinations, 

improving IDR dispute processing. As 

discussed in section II.D.2.a. of this 

preamble, the Departments anticipate 

that the Federal IDR portal would be 

able to prepopulate information 

included in the open negotiation notice, 

open negotiation response notice, and 

the notice of IDR initiation notice, 

which would mitigate additional burden 

on the disputing parties. 

The proposed rules also include 

additional content requirements for the 

notice of IDR initiation response that 

require a statement as to whether the 

non-initiating party agrees or objects to 

the initiating party’s preferred certified 

IDR entity and, if the non-initiating 

party objects to the initiating party’s 

preferred certified IDR entity, the name 

of an alternative preferred certified IDR 

entity. This proposed requirement is to 

meet the statutory requirement under 

Code section 9816(c)(4)(F), ERISA 

section 716(c)(4)(F), and PHS Act 

section 2799A–1(c)(4)(F) that the 

Departments must provide a method for 

the plan or issuer and the provider, 

facility, or provider of air ambulance 

services that are parties to a 

determination subject to the Federal IDR 

process to jointly select a certified IDR 

entity no later than 3 business days 

following the date of the IDR initiation. 

Section II.E.1.a. of this preamble further 

describes the selection of the certified 

IDR entity process and the proposed 

amendments to the certified IDR entity 

selection process. 

The Departments anticipate updating 

the Federal IDR portal to create 

parameters to ensure information is 

submitted for each of the required fields 

for the notice of IDR initiation and 

notice of IDR initiation response. 

However, failure to timely furnish a 

notice of IDR initiation response would 

not delay the timeframe for initiation of 

the Federal IDR process (because the 

Federal IDR process has been initiated 

once a notice of IDR initiation has 

timely been submitted to the noninitiating party and the Departments) or 

delay any subsequent timeframes under 

the Federal IDR process. As discussed in 

section II.D.1.b. of this preamble, if a 

party were to fail to furnish a notice of 

IDR initiation response to the other 

party and the Departments or fail to fill 

out all of the required information in 

good faith (for example, intentional 

omission of detail with the intent to 

advance the process without providing 

sufficient content), the Departments 

would review and determine whether 

enforcement actions may be warranted. 

The Departments seek comment on 

these proposals, including any 

administrative burden associated with 

the additional disclosure requirements. 

3. Manner of Notices 

The October 2021 interim final rules 

generally require a party to initiate open 

negotiations and initiate the Federal IDR 

process by providing written notice to 

the other party.140 The party initiating 

the Federal IDR process must also 

furnish the notice of IDR initiation to 

the Departments through the Federal 

IDR portal. In both cases, notice to the 

other party may be provided 

electronically if the following two 

conditions are satisfied: (1) the party 

sending the open negotiation notice has 

a good faith belief that the electronic 

method is readily accessible to the other 

party; and (2) the notice is provided in 

paper form free of charge upon 

request.141 As mentioned in section 

II.D.1. and II.D.2. of this preamble, the 

Departments are proposing to remove 

the regulatory text at 26 CFR 54.9816– 

8T(b)(1)(ii)(B), (b)(2)(iii)(B), and 

(b)(2)(iii)(C), 29 CFR 2590.716– 

8(b)(1)(ii)(B), (b)(2)(iii)(B), and 

(b)(2)(iii)(C), and 45 CFR 

149.510(b)(1)(ii)(B), (b)(2)(iii)(B), and 

(b)(2)(iii)(C) and instead include new 

requirements related to the manner of 

submission of open negotiation notices 

and notices of IDR initiation to the 

Departments and the other party at 26 

CFR 54.9816–8(b)(3), 29 CFR 2590.716– 

8(b)(3), and 45 CFR 149.510(b)(3). The 

Departments propose that these new 

requirements would also apply to the 

open negotiation response notice and 

the notice of IDR initiation response. 

Specifically, the Departments propose 

that a party must furnish to the other 

party and the Departments the notices 

and supporting documentation 

described in proposed paragraphs 

(b)(1)(ii) (open negotiation notice), 

(b)(1)(iii) (open negotiation response 

notice), (b)(2)(ii) (notice of IDR 

initiation), and (b)(2)(iii) (notice of IDR 

initiation response) through the Federal 

IDR portal, using the standard forms 

developed by the Departments. 

Under the current regulations, the 

open negotiation notice between parties 

has taken place outside of the Federal 

IDR portal and has led to challenges for 

the Departments and certified IDR 

entities to confirm that all requirements 

related to the open negotiation notice 

and open negotiation period have been 

satisfied for each initiated dispute. 

Requiring a party to submit the open 

negotiation notice to the Departments 

and the other party through the Federal 

IDR portal would provide a record of 

whether and when the initiating party 

began open negotiations, which would 

help inform whether the item or service 

that is the subject of negotiation is 

eligible for the Federal IDR process. The 

Departments expect that this would 

decrease the amount of time and 

resources the Departments and certified 

IDR entities spend seeking information 

from the disputing parties to determine 

whether the open negotiation period 

was initiated and exhausted, which 

would ultimately provide certified IDR 

entities more time to review eligible 

disputes. 

As specified in the October 2021 

interim final rules and set forth in these 

proposed rules, the Departments are of 

the view that it is important for a party 

receiving a notice to be furnished the 

notice on the same day as it is submitted 

to the Departments, because many of the 

timeframes required in the October 2021 

interim final rules and proposed in 

these proposed rules are triggered upon 

receipt of a notice.142 Currently, when 

an initiating party submits the notice of 

IDR initiation to the Federal IDR portal, 

the non-initiating party receives a notice 

from the Departments on the same day 

the Departments receive the notice of 

IDR initiation. This notice from the 

Departments to the non-initiating party 

provides information contained in the 

notice of IDR initiation. However, it 

does not include any of the supporting 

documentation that the initiating party 

may have provided with the notice of 

IDR initiation. While the initiating party 

is required to directly furnish the notice 

of IDR initiation to the other party, noninitiating parties report that, at times, 

the initiating party provides the notice 

after the period for IDR initiation has 

expired, although it submits the notice 

to the Departments within the 

applicable notice period. 

If these proposed rules are finalized, 

the Departments would enhance the 

Federal IDR portal to allow the parties 

to transmit notices, including 

supporting documentation, through the 

Federal IDR portal so that the party 

sending the notice can notify the 


lotter on DSK11XQN23PROD with PROPOSALS2
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143 87 FR 55991 through 55992. 

144 26 CFR 54.9816–8T(c)(1)(iv), 29 CFR 

2590.716–8(c)(1)(iv), and 45 CFR 149.510(c)(1)(iv). 

145 26 CFR 54.9816–8T(c)(1)(iii)–(iv), 29 CFR 

2590.716–8(c)(1)(iii)–(iv), and 45 CFR 

149.510(c)(1)(iii)–(iv). 

146 26 CFR 54.9816–8T(c)(1)(iii)(A)(3), 29 CFR 

2590.716–8(c)(1)(iii)(A)(3), and 45 CFR 

149.510(c)(1)(iii)(A)(3). 

147 26 CFR 54.9816–8T(c)(1)(v), 29 CFR 2590.716– 

8(c)(1)(v), and 45 CFR 149.510(c)(1)(v). 

Departments and the other party at the 

same time. Further, as discussed in 

sections II.D.1.c. and II.D.2.a. of this 

preamble, the Departments are 

proposing to require similar content 

requirements in the open negotiation 

notice and notice of IDR initiation. By 

streamlining the submission of these 

notices, the Departments would be able 

to use information that was submitted 

for one notice to pre-populate 

subsequent notices, reducing the burden 

of providing duplicative information. 

For instance, if a party decides to 

initiate the Federal IDR process after 

submitting the open negotiation notice 

through the Federal IDR portal and 

completing the 30-business-day open 

negotiation period, the Departments 

intend that the Federal IDR portal 

would pre-populate the fields in the 

notice of IDR initiation and notice of 

IDR initiation response with the same 

information that was provided in the 

open negotiation notice and open 

negotiation response notice, as 

applicable. The Departments solicit 

comment on these proposals. 

E. Federal IDR Process Following 

Initiation 

1. Certified IDR Entity Selection and 

Eligibility Determinations 

a. Certified IDR Entity Selection 

Section 9816(c)(4)(F) of the Code, 

section 716(c)(4)(F) of ERISA, section 

2799A–1(c)(4)(F) of the PHS Act, and 

the October 2021 interim final rules 143

provide parties to a dispute 3 business 

days after the initiation date of the 

Federal IDR process to jointly select a 

certified IDR entity. If parties to a 

dispute fail to jointly agree and select a 

certified IDR entity within the required 

timeframe, the Departments must select 

the certified IDR entity no later than 6 

business days after the initiation date of 

the Federal IDR process. More 

specifically, under the current rules, the 

non-initiating party may agree or object 

to the preferred certified IDR entity that 

the initiating party identifies in its 

notice of IDR initiation. If the noninitiating party fails to object within 3 

business days after the date of IDR 

initiation, the preferred certified IDR 

entity identified in the notice of IDR 

initiation will be selected and will be 

treated as jointly agreed to by the 

parties. In this case, the initiating 

party’s preferred certified IDR entity 

becomes the certified IDR entity for the 

dispute, provided that the certified IDR 

entity does not have a conflict of 

interest. If the non-initiating party 

objects to the initiating party’s preferred 

certified IDR entity, it must notify the 

initiating party of the objection and 

propose an alternative preferred 

certified IDR entity within 3 business 

days after the date of IDR initiation. The 

initiating party must then agree or object 

to the alternative preferred certified IDR 

entity within 3 business days after the 

date of IDR initiation. If the initiating 

party fails to agree or object to the 

alternative preferred certified IDR entity 

within that timeframe, the alternative 

preferred certified IDR entity selected by 

the non-initiating party will be selected 

and will be treated as jointly agreed to 

by the parties. If the parties fail to 

jointly agree on a certified IDR entity 

within 3 business days after the date of 

IDR initiation, the Departments select a 

certified IDR entity through random 

selection.144

Further, under the current rules, upon 

the joint selection of a certified IDR 

entity the initiating party must provide 

a notice of certified IDR entity selection 

to the Departments indicating whether 

the parties have jointly agreed or failed 

to agree on the selection of a certified 

IDR entity, as soon as practicable but no 

later than 1 business day after 

selection.145 The notification must 

include an attestation by both parties, or 

by the initiating party if the noninitiating party fails to object to the 

selection of the certified IDR entity, that 

the selected certified IDR entity does not 

have a conflict of interest as specified in 

26 CFR 54.9816–8(c)(1)(ii), 29 CFR 

2590.716–8(c)(1)(ii), and 45 CFR 

149.510(c)(1)(ii).146 Under the current 

rules, after the selection of the certified 

IDR entity by the parties (including 

when the initiating party selects a 

certified IDR entity and the noninitiating party does not object), or by 

the Departments when the parties fail to 

select a certified IDR entity, the certified 

IDR entity must review the selection 

and attest that it meets these conflict-ofinterest requirements.147 If the certified 

IDR entity is unable to attest that it 

meets the conflict-of-interest 

requirements within 3 business days of 

selection, the parties, upon notification, 

must select another certified IDR entity. 

In such circumstances, the date of the 

notification sent by the certified IDR 

entity informing the parties that it 

cannot attest that it meets the conflictof-interest requirements is treated as the 

date of IDR initiation for the purposes 

of selecting a new certified IDR entity. 

Since implementation of the Federal 

IDR process, the Departments have 

identified potential areas to improve 

upon and provide additional clarity 

with respect to the process for selecting 

a certified IDR entity. First, in the 

Departments’ experience implementing 

these rules, when a non-initiating party 

waits until the third business day after 

the date of IDR initiation to select an 

alternative preferred certified IDR 

entity, the initiating party lacks 

sufficient time to agree or object to the 

alternative preferred certified IDR 

entity. As a result, the alternative 

preferred certified IDR entity will be 

‘‘jointly’’ selected by default. The 

Departments are of the view that in 

order for a certified IDR entity to be 

‘‘jointly’’ selected, the parties must 

agree on, or be given the opportunity to 

object to that certified IDR entity. 

Therefore, the Departments propose to 

amend the process for selecting a 

certified IDR entity when the parties fail 

to jointly agree on a certified IDR entity 

under section 9816(c)(4)(F)(i) of the 

Code, section 716(c)(4)(F)(i) of ERISA, 

and section 2799A–1(c)(4)(F)(i) of the 

PHS Act. 

Second, as part of the current 

operations, the Federal IDR portal 

automates the process for selecting the 

certified IDR entity such that the 

initiating party and the non-initiating 

party communicate directly through the 

Federal IDR portal when selecting, 

agreeing to, or objecting to a certified 

IDR entity. Therefore, the Departments 

are notified automatically through the 

Federal IDR portal if both parties have 

jointly agreed on a certified IDR entity. 

Similarly, when the Departments select 

a certified IDR entity, the disputing 

parties are notified automatically, 

provided the selected certified IDR 

entity attests to having no conflicts of 

interest. As described in section II.D. of 

this preamble, if finalized, these 

proposed rules would collect 

information regarding the applicability 

of the Federal IDR process from both 

parties as part of the proposed notice of 

IDR initiation and notice of IDR 

initiation response requirements. 

Because this information is automated 

through the Federal IDR portal or would 

be collected at other points of the IDR 

initiation process, the Departments 

propose to amend the notice of certified 

IDR entity selection requirements of 26 

CFR 54.9816–8(c)(1)(iii), 29 CFR 

2590.716–8(c)(1)(iii), and 45 CFR 

149.510(c)(1)(iii) and establish at 26 

CFR 54.9816–8(c)(1)(i)(D), 29 CFR 

2590.716–8(c)(1)(i)(D), and 45 CFR 


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Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75775 

148See https://www.cms.gov/files/document/ 

federal-idr-guidance-idr-entities-march-2023.pdf 

and https://www.cms.gov/files/document/federalidr-guidance-disputing-parties-march-2023.pdf. 

149.510(c)(1)(i)(D) the mechanism for 

parties to agree or object and select 

another alternative preferred certified 

IDR entity after the non-initiating party 

submits the notice of IDR initiation 

response form and before the deadline 

for parties to jointly select a certified 

IDR entity, which is within 3 business 

days after the date of IDR initiation. 

Lastly, to provide clarity on the 

Federal IDR process timeframes, in the 

Federal IDR Process Guidance for 

Certified IDR Entities and the Federal 

IDR Process Guidance for Disputing 

Parties, the Departments clarified that 

the certified IDR entity is 

‘‘preliminarily’’ selected until it attests 

that it does not have a conflict of 

interest and determines whether the 

Federal IDR Process is applicable, 

thereby finalizing the selection.148 The 

guidance further clarifies that the 

certified IDR entities must submit their 

conflict-of-interest attestation within 3 

business days of being contingently 

selected, and that the parties must 

submit their offers for an out-of-network 

payment amount, as specified in 26 CFR 

54.9816–8(c)(4)(i), 29 CFR 2590.716– 

8(c)(4)(i), and 45 CFR 149.510(c)(4)(i) no 

later than 10 business days after final 

selection of the certified IDR entity. To 

provide further clarity and to codify the 

process and timeframes for selecting a 

certified IDR entity, the certified IDR 

entity’s conflict-of-interest review, and 

the date the certified IDR entity 

selection is considered finally selected, 

the Departments propose to amend 26 

CFR 54.9816–8(c)(1), 29 CFR 2590.716– 

8(c)(1), and 45 CFR 149.510(c)(1) to 

establish a process that includes both 

preliminary selection of the certified 

IDR entity and final selection of the 

certified IDR entity. 

i. Preliminary Selection of the Certified 

IDR Entity 

The Departments propose to amend 

26 CFR 54.9816–8T(c)(1)(i), 29 CFR 

2590.716–8(c)(1)(i), and 45 CFR 

149.510(c)(1)(i) to establish the 

preliminary selection of the certified 

IDR entity in accordance with the 

statutory requirement at section 

9816(c)(4)(F) of the Code, section 

716(c)(4)(F) of ERISA, and section 

2799A–1(c)(4)(F) of the PHS Act. Under 

the process for preliminary selection of 

the certified IDR entity proposed in 

these rules, the non-initiating party 

would be required to agree or object to 

the preferred certified IDR entity in the 

notice of IDR initiation response within 

3 business days after the date of IDR 

initiation as discussed in section II.D.2.b 

of this preamble. Under these proposed 

rules, if the non-initiating party agrees, 

or fails to object, to the selection of the 

initiating party’s preferred certified IDR 

entity in the notice of IDR initiation 

response within the 3-business-day 

timeframe after the date of IDR 

initiation, the initiating party’s preferred 

certified IDR entity would be considered 

jointly selected by the parties on the 

third business day after the date of IDR 

initiation. If the non-initiating party 

objects to the selection of the initiating 

party’s preferred certified IDR entity by 

designating an alternative preferred 

certified IDR entity in the notice of IDR 

initiation response within the 3- 

business-day timeframe after the date of 

IDR initiation, the initiating party would 

be required to agree or object to the 

alternative preferred certified IDR entity 

using the notice of certified IDR entity 

selection. Under these proposed rules, if 

the initiating party agrees to the 

alternative preferred certified IDR entity 

within 3 business days after the date of 

IDR initiation, or if the non-initiating 

party submits the notice of IDR 

initiation response on or before the 

second business day after the date of 

IDR initiation and the initiating party 

fails to respond within 3 business days 

after the date of IDR initiation, the 

alternative preferred certified IDR entity 

would be considered jointly selected by 

the parties. If the non-initiating party 

submits the notice of IDR initiation 

response on the third business day after 

the date of IDR initiation and the 

initiating party does not agree on the 

same day, the parties would have failed 

to jointly select a certified IDR entity. 

Additionally, these proposed rules 

would amend the process for the 

initiating and non-initiating parties to 

go back-and-forth in selecting and 

responding to a selection of an 

alternative preferred certified IDR entity 

after the non-initiating party submits a 

notice of IDR initiation response within 

the 3-business-day period after IDR 

initiation. Specifically, if a certified IDR 

entity is not jointly selected because the 

initiating party submits a notice of 

certified IDR entity selection objecting 

to the non-initiating party’s alternative 

preferred certified IDR entity reflected 

in the notice of IDR initiation response, 

the non-initiating party may agree to the 

alternative preferred certified IDR entity 

selected in the initiating party’s notice 

of certified IDR entity selection or select 

another alternative preferred certified 

IDR entity by submitting a notice of 

certified IDR entity selection to the 

initiating party and to the Departments. 

This back-and-forth may continue until 

the earlier of the date that the parties 

agree on an alternative preferred 

certified IDR entity or the deadline for 

joint selection, which is 3 business days 

after the date of IDR initiation. However, 

if either the notice of IDR initiation 

response or the notice of certified IDR 

entity selection is submitted on the 

third business day after the date of IDR 

initiation, the party last in receipt of the 

applicable notice would not be allowed 

to select another alternative preferred 

certified IDR entity, as discussed later in 

this section of the preamble. Once a 

party submits a notice of certified IDR 

entity selection, it may not submit 

another notice of IDR entity selection 

until after it receives a responding 

notice of certified IDR entity selection 

from the other party. 

If a party submits a notice of certified 

IDR entity selection to the other party 

on the first or second day after the date 

of IDR initiation and the party in receipt 

of the notice agrees or fails to object to 

the alternative preferred certified IDR 

entity by the third business day after the 

date of IDR initiation, the alternative 

preferred certified IDR entity would be 

considered jointly selected by the 

parties. If a party submits a notice of 

certified IDR entity selection to the 

other party on the third business day 

after the date of IDR initiation and the 

party last in receipt of the notice agrees 

to the alternative preferred certified IDR 

entity on the same day, the alternative 

preferred certified IDR entity will be 

considered jointly selected by the 

parties. If a party submits a notice of 

certified IDR entity selection to the 

other party on the third business day 

after the date of IDR initiation and the 

party last in receipt of the notice does 

not agree to the alternative preferred 

certified IDR entity on the same day, the 

parties would have failed to jointly 

select a certified IDR entity. 

Under these proposed rules at 26 CFR 

54.9816–8(c)(1)(i)(D), 29 CFR 2590.716– 

8(c)(1)(i)(D), and 45 CFR 

149.510(c)(1)(i)(D), to notify the 

Departments and the other party of any 

subsequent agreement or objection to an 

alternative preferred certified IDR entity 

after the non-initiating party submits the 

notice of IDR initiation response, a party 

must submit a notice of certified IDR 

entity selection. The party must furnish 

the notice of certified IDR entity 

selection using the standard form 

developed by the Departments through 

the Federal IDR portal within 3 business 

days after the date of IDR initiation. 

The Departments propose to amend 

the existing content of the notice of 

certified IDR entity selection and 

specify that the notice must include a 


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75776 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

149Section 9816(c)(4)(F)(ii) of the Code, section 

716(c)(4)(F)(ii) of ERISA, and section 2799A– 

1(c)(4)(F)(ii) of the PHS Act. 

statement indicating the party’s 

agreement with or objection to the other 

party’s alternative preferred certified 

IDR entity and, if applicable, an 

explanation of any conflict of interest 

with the other party’s alternative 

preferred certified IDR entity. If the 

party in receipt of a notice of certified 

IDR entity selection objects to the other 

party’s alternative preferred certified 

IDR entity and the party submits a 

notice of certified IDR entity selection 

by the end of the third business day 

after the date of IDR initiation, that 

party’s notice of certified IDR entity 

selection reflecting the objection must 

include the name of another alternative 

preferred certified IDR entity. 

The Departments propose to amend 

26 CFR 54.9816–8(c)(1)(iv), 29 CFR 

2590.716–8(c)(1)(iv), and 45 CFR 

149.510(c)(1)(iv), which describe the 

certified IDR entity selection process 

when the disputing parties fail to jointly 

select a certified IDR entity, and 

redesignate the paragraphs as amended 

26 CFR 54.9816–8(c)(1)(ii), 29 CFR 

2590.716–8(c)(1)(ii), and 45 CFR 

149.510(c)(1)(ii). If the parties fail to 

jointly select a certified IDR entity 

within 3 business days after the date of 

IDR initiation, the Departments would 

select a certified IDR entity. The parties 

would have failed to jointly select a 

certified IDR entity if, by the end of the 

third business day after the date of IDR 

initiation, the party last in receipt of the 

notice of IDR initiation response or the 

notice of certified IDR entity selection 

has objected to the other party’s 

alternative preferred certified IDR 

entity, or if the notice of IDR initiation 

response or the notice of certified IDR 

entity selection is submitted to the other 

party on the third business day after the 

date of IDR initiation and the party in 

receipt of the notice does not agree to 

the alternative preferred certified IDR 

entity within 3 business days after the 

date of IDR initiation. 

As part of the Departments’ process to 

select a certified IDR entity when the 

parties do not jointly select one,149

under these proposed rules, the 

Departments would first confirm 

whether a party submitted the notice of 

IDR initiation response or notice of 

certified IDR entity selection with an 

alternative preferred certified IDR entity 

on the third business day after the date 

of IDR initiation without the other 

party’s agreement to the selection. If 

either notice was provided on the third 

business day after the date of IDR 

initiation without the other party’s 

agreement to the alternative preferred 

certified IDR entity by the end of third 

business day after the date of IDR 

initiation, the Departments would 

provide the party last in receipt of the 

applicable notice 2 additional business 

days to either agree or object to the other 

party’s alternative preferred certified 

IDR entity selection. In these 

circumstances, under these proposed 

rules, if a party last in receipt of the 

notice of IDR initiation response or the 

notice of certified IDR entity selection 

agrees with the other party’s alternative 

preferred certified IDR entity and 

notifies the Departments of the 

agreement or fails to notify the 

Departments of its objection in the 

Federal IDR portal by the fifth business 

day after the date of IDR initiation, the 

Departments would select the final 

alternative preferred certified IDR entity 

selected in the applicable notice. In 

disputes where the applicable notice 

was submitted on the third business day 

after the date of IDR initiation, the party 

last in receipt of the notice would not 

be allowed to select another alternative 

preferred certified IDR entity. If the 

party last in receipt of the notice notifies 

the Departments of its objection to the 

alternative preferred certified IDR entity 

by the fifth business day after the date 

of IDR initiation, the Departments 

would proceed with the random 

selection of the certified IDR entity from 

among the certified IDR entities (other 

than the preferred certified IDR entity 

and any alternative preferred certified 

IDR entity previously selected in such 

dispute by a party, unless there is no 

other certified IDR entity available to 

select) that charge a fee within the 

allowed range of certified IDR entity 

fees on the sixth business day after the 

date of IDR initiation. If there are 

insufficient certified IDR entities that 

charge a fee within the allowed range of 

certified IDR entity fees available to 

arbitrate the dispute, the Departments 

would select a certified IDR entity that 

has received approval, as described in 

paragraph 26 CFR 54.9816– 

8T(e)(2)(vii)(B), 29 CFR 2590.716– 

8(e)(2)(vii)(B), and 45 CFR 

149.510(e)(2)(vii)(B), to charge a fee 

outside of the allowed range of certified 

IDR entity fees. In either case, the 

Departments would notify the parties of 

the preliminarily selected certified IDR 

entity not later than 6 business days 

after the date of IDR initiation. The 

Departments are of the view that this 

proposed requirement would give each 

party a reasonable opportunity to review 

the other party’s alternative preferred 

selected certified IDR entity and to 

notify the other party and the 

Departments whether the party agrees or 

disagrees with the selection. Consistent 

with section 9816(c)(4)(F) of the Code, 

section 716(c)(4)(F) of ERISA, and 

section 2799A–1(c)(4)(F) of the PHS Act, 

these requirements would ensure that 

the certified IDR entity selection 

timeframe occurs within 6 business 

days after the date of Federal IDR 

initiation, when the parties do not 

jointly select the certified IDR entity. 

The Departments also propose to 

amend 26 CFR 54.9816–8T(c)(1)(iii), 29 

CFR 2590.716–8(c)(1)(iii), and 45 CFR 

149.510(c)(1)(iii) to provide that the date 

of preliminary selection of the certified 

IDR entity is 3 business days after the 

date of IDR initiation if the parties 

jointly selected a certified IDR entity, or 

6 business days after the date of IDR 

initiation if the parties fail to jointly 

select a certified IDR entity and the 

Departments instead select the certified 

IDR entity. 

The Departments seek comment on 

these proposals. 

ii. Final Selection of the Certified IDR 

Entity and Certified IDR Entity Conflictof-Interest Review 

The Departments propose to add 26 

CFR 54.9816–8(c)(1)(iv), 29 CFR 

2590.716–8(c)(1)(iv), and 45 CFR 

149.510(c)(1)(iv) to establish the process 

for finalizing certified IDR entity 

selection. Under the proposed rules, the 

date of final selection of the certified 

IDR entity would be the date that 

triggers the timeframes for the 

requirement to issue payment 

determinations (not later than 30 

business days after the date of final 

selection of the certified IDR entity) and 

the submission of offers from both 

parties (not later than 10 business days 

after the date of final selection of the 

certified IDR entity) under section 

9816(c)(5)(A) and (B) of the Code, 

section 716(c)(5)(A) and (B) of ERISA, 

and section 2799A–1(c)(5)(A) and (B) of 

the PHS Act. 

The statute provides that a certified 

IDR entity must meet certain conflict-ofinterest standards before being selected 

as a certified IDR entity assigned to 

make a payment determination. 

However, the statute is silent on the 

specific timeframe or process for the 

selected certified IDR entity to review 

the parties’ (or the Departments’) 

selection to ensure that a conflict of 

interest does not exist. Based on 

feedback from interested parties and the 

Departments’ experience with 

implementation of the Federal IDR 

process, the Departments are of the view 

that it is important to implement a 

timeframe that permits a meaningful 

opportunity for conflict-of-interest 


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Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75777 

150 26 CFR 54.9816–8T(c)(1)(v), 29 CFR 2590.716– 

8(c)(1)(v), and 45 CFR 149.510(c)(1)(v). 

151U.S. Department of Health and Human 

Services, U.S. Department of Labor, and U.S. 

Department of the Treasury. (Oct. 2022). Federal 

Independent Dispute Resolution (IDR) Process 

Guidance for Certified IDR Entities. https://

www.cms.gov/CCIIO/Resources/Regulations-andGuidance/Downloads/Federal-IndependentDispute-Resolution-Process-Guidance-for-CertifiedIDR-Entities.pdf. 

review by the certified IDR entity while 

ensuring that it does not limit the time 

periods for either disputing parties to 

submit their offers or for the certified 

IDR entity to make a payment 

determination. To streamline this 

process, the Departments are of the view 

that permitting the certified IDR entity 

to be considered preliminarily selected 

until the certified IDR entity confirms 

that it has no conflict of interest with 

either party, would increase the 

efficiency of the process while 

balancing the need to ensure that 

certified IDR entities are free of conflict. 

After the certified IDR entity is 

preliminarily selected pursuant to 26 

CFR 54.9816–8(c)(1)(iii), 29 CFR 

2590.716–8(c)(1)(iii), and 45 CFR 

149.510(c)(1)(iii), the Departments 

propose that the preliminarily selected 

certified IDR entity would review the 

selection and attest to the Departments 

whether it meets the conflict-of-interest 

requirements as outlined in proposed 26 

CFR 54.9816–8(c)(1)(iv)(A)(1) through 

(3), 29 CFR 2590.716–8(c)(1)(iv)(A)(1) 

through (3), and 45 CFR 

149.510(c)(1)(iv)(A)(1) through (3). The 

Departments are not proposing new 

conflict-of-interest requirements, 

however, the Departments are proposing 

to make non-substantive amendments to 

improve clarity and align with the 

structure of the reorganized provisions 

as follows: (1) the certified IDR entity 

does not have a conflict of interest as 

defined in paragraphs 26 CFR 54.9816– 

8(a)(2)(iv), 29 CFR 2590.716–8(a)(2)(iv), 

and 45 CFR 149.510(a)(2)(iv); (2) the 

certified IDR entity will only assign 

personnel to a dispute and make 

decisions regarding hiring, 

compensation, termination, promotion, 

or other similar matters related to 

personnel assigned to the dispute in a 

manner that is not based upon the 

likelihood that the assigned personnel 

will support a particular party to the 

dispute; and (3) the certified IDR entity 

will not assign any personnel to a 

dispute who would have any conflicts 

of interest, as defined in paragraphs 26 

CFR 54.9816–8(a)(2)(iv), 29 CFR 

2590.716–8(a)(2)(iv), and 45 CFR 

149.510(a)(2)(iv), regarding any party to 

the dispute or whose relationship with 

a party within the 1 year immediately 

preceding the assignment to the dispute 

would violate the restrictions on aiding 

or advising a former employer or 

principal in a manner similar to the 

restrictions set forth in 18 U.S.C. 207(b). 

Under 26 CFR 54.9816–8(c)(1)(iv)(B), 

29 CFR 2590.716–8(c)(1)(iv)(B), and 45 

CFR 149.510(c)(1)(iv)(B), the 

Departments also propose that if the 

certified IDR entity notifies the 

Departments within 3 business days of 

the date of preliminary selection of the 

certified IDR entity that it does not meet 

the conflict-of-interest requirements or 

does not respond within 3 business days 

after the date of preliminary selection of 

the certified IDR entity, the Departments 

would randomly select another certified 

IDR entity. The Departments would 

notify the parties of the new randomly 

preliminarily selected certified IDR 

entity no later than 1 business day after 

the previously selected certified IDR 

entity notifies the Departments that it 

has a conflict of interest, or if the 

previously selected certified IDR entity 

fails to respond within 3 business days 

after the date of preliminary selection of 

the certified IDR entity, no later than 1 

business day after the end of the 3- 

business-day period. 

These proposed rules would 

streamline the process for certified IDR 

entity selection when the preliminarily 

selected certified IDR entity fails to 

timely respond or notifies the 

Departments that it cannot meet the 

conflict-of-interest requirements in 

proposed 26 CFR 54.9816–8(c)(1)(iv)(A), 

29 CFR 2590.716–8(c)(1)(iv)(A), and 45 

CFR 149.510(c)(1)(iv)(A). Under the 

October 2021 interim final rules, when 

a selected certified IDR entity is unable 

to attest that it has no conflict of interest 

within 3 business days of certified IDR 

entity selection, the parties to the 

dispute are given another opportunity to 

jointly agree on a certified IDR entity, 

and the end of the 3-business-day 

period is treated as the date of initiation 

of the Federal IDR process. Under these 

proposed rules, when a preliminarily 

selected certified IDR entity provides 

notice of a conflict of interest, the 

Departments would select another 

certified IDR entity through random 

selection, as opposed to allowing the 

parties additional opportunities to 

jointly select a different certified IDR 

entity, in order to create operational 

efficiencies and minimize delays in 

processing disputes. Additionally, if the 

certified IDR entity does not respond to 

the conflict-of-interest review by the 

end of the 3-business-day period after 

preliminary selection of the certified 

IDR entity, the Departments would 

randomly select another certified IDR 

entity. If a certified IDR entity cannot 

review and provide a response related to 

a conflict of interest within a 3- 

business-day period, the dispute would 

move to a different certified IDR entity 

that may have the capacity to review the 

dispute in a timelier manner, which 

would improve the overall timeliness of 

dispute processing. 

Under 26 CFR 54.9816–8(c)(1)(iv)(C), 

29 CFR 2590.716–8(c)(1)(iv)(C), and 45 

CFR 149.510(c)(1)(iv)(C) of these 

proposed rules, if the certified IDR 

entity that has been preliminarily 

selected attests within 3 business days 

that it meets the conflict-of-interest 

requirements, the Departments would 

notify the parties of the final selection 

of that certified IDR entity no later than 

1 business day after the certified IDR 

entity attests that it meets the conflictof-interest requirements The date of 

final selection of the certified IDR entity 

is the date that the Departments provide 

this notice to the parties. 

Lastly, the Departments also propose 

to remove 26 CFR 54.9816–8T(c)(1)(v), 

29 CFR 2590.716–8(c)(1)(v), and 45 CFR 

149.510(c)(1)(v), as these requirements 

regarding certified IDR entity conflict of 

interest and Federal IDR process 

eligibility review would be required 

under the paragraphs at 26 CFR 9816– 

8(c)(1)(iv)(A), 29 CFR 2590.716– 

8(c)(1)(iv)(A), and 45 CFR 

149.510(c)(1)(iv)(A) and 26 CFR 9816– 

8(c)(2), 29 CFR 2590.716–8(c)(2), and 45 

CFR 149.510(c)(2), respectively. 

The Departments seek comment on 

these proposals. 

b. Federal IDR Process Eligibility 

Review 

i. Federal IDR Process Eligibility 

Determination by Certified IDR Entity 

The No Surprises Act does not specify 

a timeframe or process for which the 

Departments or certified IDR entities 

must assess a dispute’s eligibility for the 

Federal IDR process. Under the October 

2021 interim final rules, certified IDR 

entities are required to review the 

information in the notice of IDR 

initiation and notice of certified IDR 

entity selection to determine whether 

the Federal IDR process applies and if 

not, to notify the Departments within 3 

business days of making that 

determination.150 The Departments 

further clarified in the Federal IDR 

Process Guidance for Certified IDR 

Entities 151 that certified IDR entities 

must make this eligibility determination 

within 3 business days after they are 

selected, which is before the parties 

must submit an offer of an out-ofnetwork rate (not later than 10 business 

days after the date of selection of the 

certified IDR entity) and before the 

certified IDR entity must make a 


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75778 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

152Section 9816(c)(5)(B) of the Code, section 

716(c)(4)(B) of ERISA, and section 2799A–1(c)(4)(B) 

of the PHS Act. 

153See https://www.cms.gov/files/document/idreeligibility-support-guidance-11212022-finalupdated.pdf. 

payment determination (30 business 

days after the date of selection of the 

certified IDR entity). 

To provide certified IDR entities 

additional time to conduct eligibility 

reviews before the parties must submit 

their offers, the Departments propose to 

remove 26 CFR 54.9816–8T(c)(1)(v), 29 

CFR 2590.716–8(c)(1)(v), and 45 CFR 

149.510(c)(1)(v), and add proposed 26 

CFR 54.9816–8(c)(2)(i), 29 CFR 

2590.716–8(c)(2)(i), and 45 CFR 

149.510(c)(2)(i), which would allow 

certified IDR entities 5 business days 

after the date of final selection of the 

certified IDR entity to make an 

eligibility determination. Under these 

proposed rules, unless the departmental 

eligibility review described in section 

II.E.1.b.ii. of this preamble applies, the 

selected certified IDR entity would be 

required to review the information in 

the notice of IDR initiation, the notice 

of IDR initiation response, and any 

additional information as discussed in 

proposed 26 CFR 54.9816–8(c)(2)(iii), 29 

CFR 2590.716–8(c)(2)(iii), and 45 CFR 

149.510(c)(2)(iii), and make a final 

determination as to whether the item or 

service is a qualified IDR item or service 

that is eligible for the Federal IDR 

process. The certified IDR entity would 

be required to make this eligibility 

determination and notify the 

Departments and both parties no later 

than 5 business days after the date of 

final selection of the certified IDR 

entity. If the certified IDR entity 

determines that the item or service is 

not a qualified IDR item or service, the 

dispute would be closed, and the 

selected certified IDR entity would not 

take any action with regard to the 

dispute. 

The Departments propose to provide 

2 additional business days for certified 

IDR entities to review the notices and 

make an eligibility determination. This 

proposal would provide additional time 

while meeting the statutory requirement 

that the submission of offers be 

submitted no later than 10 days after the 

date of certified IDR entity selection.152

More specifically, under these proposed 

rules, the certified IDR entity would be 

required to determine whether a dispute 

was eligible for the Federal IDR process 

not later than 5 business days after the 

date of final selection of the certified 

IDR entity and if eligible, the parties to 

the dispute would be required to submit 

their offers not later than 10 business 

days after the final selection of the 

certified IDR entity (which would be at 

least 5 business days after the eligibility 

determination). Although currently 

eligibility reviews are generally taking 

certified IDR entities longer than 5 

business days, these proposed rules are 

intended to facilitate more efficient 

processing of eligibility reviews, and the 

Departments therefore expect that 5 

business days would be sufficient for 

this purpose if these proposed rules are 

finalized. Further, these proposed rules 

intend to balance the time certified IDR 

entities have to conduct eligibility 

reviews with the time parties are given 

to submit their final offers. Because the 

No Surprises Act provides only 10 days 

from the date of certified IDR entity 

selection for the parties to submit their 

offers, these proposed rules would 

provide equal time for eligibility review 

and for the parties to submit their offers 

after the eligibility review. 

A non-initiating party’s attestation 

that a dispute is ineligible for the 

Federal IDR process, alone, would be 

insufficient to substantiate a 

determination of ineligibility. The 

certified IDR entity (or the Departments, 

if conducting eligibility reviews as 

described in section II.E.1.b.ii. of this 

preamble) would review disputes for 

eligibility in all instances. 

The Departments seek comment on 

these proposals, including the 

appropriate amount of time certified 

IDR entities should be provided to 

conduct eligibility reviews. 

ii. Departmental Eligibility Review for 

Federal IDR Process Eligibility 

Determinations 

Even if the proposals in these 

proposed rules are finalized and the 

intended results of a more efficient 

eligibility review process and fewer 

ineligible initiated disputes are realized, 

circumstances may still arise where the 

Departments would need to take actions 

to facilitate more timely dispute 

processing, such as when the volume of 

disputes outpaces the capacity of 

certified IDR entities to timely process 

eligibility determinations. To address 

such circumstances, and provide for 

such flexibility, the Departments 

propose adding 26 CFR 54.9816– 

8(c)(2)(ii), 29 CFR 2590.716–8(c)(2)(ii), 

and 45 CFR 149.510(c)(2)(ii), which 

would establish an eligibility review 

process whereby, when the conditions 

set forth in 26 CFR 54.9816– 

8(c)(2)(ii)(A), 29 CFR 2590.716– 

8(c)(2)(ii)(A), and 45 CFR 

149.510(c)(2)(ii)(A) are met, as described 

in section II.E.1.b.ii. of this preamble, 

the Departments would conduct the 

eligibility review and make the 

eligibility determination on behalf of the 

certified IDR entity (departmental 

eligibility review). 

Under these proposed rules, if the 

Departments determine that an item or 

service is not a qualified IDR item or 

service, the dispute would be closed, 

and the preliminarily selected certified 

IDR entity would not take any action 

regarding the dispute. If the dispute 

were found to be eligible, the 

Departments would inform the 

preliminarily selected certified IDR 

entity of eligibility so that it may 

conduct its conflict-of-interest 

assessment, and the dispute would 

otherwise continue through the Federal 

IDR process, including notification of 

the eligibility determination to the 

disputing parties by the preliminarily 

selected certified IDR entity. 

From the disputing parties’ 

perspectives, Federal IDR process 

operations during departmental 

eligibility reviews would largely be 

unchanged. Timeframes and processes 

to initiate the Federal IDR process, 

conduct certified IDR entity selection, 

and submit offers would be the same. 

The noticeable differences for disputing 

parties would be that correspondence 

related to a dispute’s eligibility, 

including any related information 

requests, would come from the 

Departments, rather than one of the 

certified IDR entities, and the potential 

impact departmental eligibility reviews 

may have on the administrative fee as 

outlined in section II.E.3.a. of this 

preamble. Additionally, depending on 

dispute volume and other factors 

impacting the Departments’ decision to 

conduct eligibility reviews, the 

Departments may choose to exercise 

their authority to extend time periods 

for extenuating circumstances as 

discussed in section II.E.5. of this 

preamble to allow more time for the 

Departments to conduct eligibility 

reviews. This proposed approach is 

similar to what is currently occurring 

under the technical assistance provided 

to certified IDR entities that was 

announced in November 2022.153 The 

principal difference is that under these 

proposed rules, when departmental 

eligibility review is in effect, the 

Departments would be able to close a 

case after determining it is ineligible, 

rather than forwarding the Departments’ 

eligibility recommendation to the 

certified IDR entity to make the final 

eligibility determination. 

For certified IDR entities, the Federal 

IDR process operations under the 

proposed departmental eligibility 

reviews would also function similarly to 

current operations except that, to 


lotter on DSK11XQN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75779 

154Section 9816(c)(4)(E) of the Code, section 

716(c)(4)(E) of ERISA, and section 2799A–1(c)(4)(E) 

of the PHS Act. 

155Section 9816(c)(8) of the Code, section 

716(c)(8) of ERISA, and section 2799A–1(c)(8) of the 

PHS Act. Also see IDR Process Fees proposed rules 

at 88 FR 65893 (Sept. 26, 2023). 

prevent certified IDR entities from 

conducting duplicative eligibility 

screenings, a certified IDR entity would 

not be notified of their selection for the 

purposes of their conflict-of-interest 

review until after eligibility has been 

determined by the Departments. The 

Departments are proposing the 

departmental eligibility review under 

certain circumstances to relieve the 

burden on certified IDR entities and to 

ensure that they can focus their time 

and resources on payment 

determinations in accordance with 

statutory timeframes. For the reasons 

discussed in section I.H. of this 

preamble, eligibility determinations 

have proven to be complex and timeconsuming for certified IDR entities, and 

certified IDR entities are not 

compensated for the time and effort 

expended in assessing dispute eligibility 

when a dispute is determined ineligible 

for the Federal IDR process. This is 

because the statute provides that 

certified IDR entities may only retain 

their fees from the non-prevailing party 

to a dispute (unless the dispute is 

withdrawn or settled as discussed in 

section II.E.1.d. of this preamble). 

Moreover, some certified IDR entities 

have been unable to accept new 

disputes because they are overburdened 

with making eligibility determinations. 

Certified IDR entities have informally 

reported to the Departments during 

regular communications that they spend 

50–80 percent of their time on making 

eligibility determinations and a few 

certified IDR entities have had to 

temporarily suspend accepting new 

disputes to manage their backlogs. 

When they are focused on eligibility 

challenges, certified IDR entities have 

less time and fewer resources to devote 

to making timely payment 

determinations. 

Ultimately, the certified IDR entities’ 

participation in the Federal IDR process 

is voluntary and must be financially 

sustainable. Furthermore, the No 

Surprises Act directs the Departments to 

administer the Federal IDR process in a 

manner that ensures participation by a 

sufficient number of certified IDR 

entities.154 If certified IDR entities 

decline to participate because it is not 

economically viable to do so, the 

directive of the statute is defeated. Thus, 

the ability for certified IDR entities to 

obtain fair compensation for the work 

conducted is critical to the success of 

the Federal IDR process, and the 

Departments are therefore of the view 

that it is in the best interests of all 

parties to reduce the burden of 

eligibility determinations when feasible. 

The Departments intend for their role 

in conducting eligibility determinations 

to be temporary. The Departments are of 

the view that when eligibility 

determinations are less burdensome and 

the volume of disputes is manageable, 

certified IDR entities are better equipped 

to conduct eligibility determinations. 

Further, the Departments do not possess 

the staff or resources to carry out the 

eligibility determinations in the long 

term and must retain contract support to 

carry out the eligibility determinations 

in the short term. The Departments 

acknowledge that any increased 

expenditures related to conducting final 

eligibility determinations would be 

reflected in the non-refundable Federal 

IDR administrative fees because these 

fees must reflect the amount of 

expenditures estimated to be made by 

the Departments for the year in carrying 

out the Federal IDR process.155

Therefore, the Departments would not 

intend to continue this role if the other 

proposed policies in these rules, along 

with ongoing Federal IDR portal 

improvements, are successful in 

improving dispute processing and 

reducing the volume of ineligible 

disputes. 

iii. Application of the Departmental 

Eligibility Review 

The departmental eligibility review 

would apply when the Departments 

determine that extenuating 

circumstances under proposed 26 CFR 

54.9816–8(g)(1), 29 CFR 2590.716– 

8(g)(1), and 45 CFR 149.510(g)(1) require 

application of the departmental 

eligibility review to facilitate timely 

payment determinations or the effective 

processing of disputes under the Federal 

IDR process. 

iv. Notification Regarding Applicability 

of the Departmental Eligibility Review 

Before invoking the application of the 

departmental eligibility review, the 

Departments propose to post advance 

public notification of the date on which 

the departmental eligibility review 

would take effect, and the reasons for 

invoking the application of the 

departmental eligibility review. Before 

ending the application of the 

departmental eligibility review, the 

Secretary will post advance public 

notification of the date on which the 

departmental eligibility review would 

no longer be in effect and the reasons for 

ending the application of the 

departmental eligibility review, as 

applicable. 

The Departments seek comment on 

these proposals, including whether the 

departmental eligibility reviews, when 

they are applicable, should be applied 

to all certified IDR entities or if the 

Departments should apply these 

proposed rules to only the certified IDR 

entities with significant dispute 

backlogs. 

c. Request for Additional Information 

Based on the Departments’ experience 

operating the Federal IDR process, 

disputing parties have not consistently 

submitted all information necessary for 

a certified IDR entity to make an 

eligibility determination, a conflict-ofinterest assessment, or a payment 

determination. Certified IDR entities 

frequently must reach out to the 

disputing parties, sometimes multiple 

times, to obtain the required 

information. Such outreach is time 

intensive, inefficient, and costly. Even 

as the Departments propose other 

methods to promote information 

submission by disputing parties 

throughout the Federal IDR process (as 

described throughout this preamble), 

certified IDR entities and the 

Departments likely will still need to 

collect additional information to make 

accurate determinations in a timely 

fashion. Thus, using the general 

rulemaking authority granted to the 

Departments to establish the Federal 

IDR process under section 9816(c)(2)(A) 

of the Code, section 716(c)(2)(A) of 

ERISA, and section 2799A–1(c)(2)(A) of 

the PHS Act, the Departments are 

proposing in new 26 CFR 54.9816– 

8(c)(2)(iii), 29 CFR 2590.716–8(c)(2)(iii), 

and 45 CFR 149.510(c)(2)(iii) to 

establish that the Departments and the 

certified IDR entity may request 

additional information from either party 

to a dispute at any time, including for 

the purpose of assessing whether a 

conflict of interest exists, conducting an 

eligibility determination, or making a 

payment determination. Under this 

proposal, a party must submit the 

requested additional information within 

5 business days to the Departments or 

the selected certified IDR entity, as 

applicable, through the Federal IDR 

portal. Following a request for 

additional information, under these 

proposed rules, the time period for the 

applicable stage of the Federal IDR 

process would be tolled until the earlier 

of the date either all of the requested 

information is provided or the 5- 

business-day period expires, and each 

subsequent timeframe in the Federal 

IDR process would be determined based 

on the date of completion of the stage 


lotter on DSK11XQN23PROD with PROPOSALS2
75780 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

156U.S. Department of Health and Human 

Services, U.S. Department of Labor, and U.S. 

Department of the Treasury. (Oct. 2022) (Federal 

Independent Dispute Resolution (IDR) Process 

Technical Assistance for Certified IDR Entities. 

August 2022, available at: https://www.cms.gov/ 

files/document/TA-certified-independent-disputeresolution-entities-August-2022.pdf. 

of the Federal IDR process that was 

tolled for provision of the requested 

information. 

However, under the statute, the 

timeframe for parties making payment 

after the payment determination cannot 

be extended. Therefore, payments 

required as a result of a payment 

determination must be provided within 

30 calendar days of that payment 

determination. If a party fails to submit 

the additional information as required, 

the related determination, including the 

eligibility determination, conflict-ofinterest review, or payment 

determination will be made without the 

requested information unless a goodcause extension of the 5-business-day 

period, as specified in 26 CFR 54.9816– 

8(g)(1)(i), 29 CFR 2590.716–8(g)(1)(i), 

and 45 CFR 149.510(g)(1)(i) has been 

provided, and the party subsequently 

submits the additional information 

requested within the extended period. 

The Departments are of the view that 

a 5-business-day period is sufficient for 

a response without unduly delaying the 

Federal IDR process. This 5-businessday period is consistent with the 5- 

business-day outreach period set forth 

in the August 2022 Technical 

Assistance for Certified IDR Entities.156

The Departments anticipate that this 

deadline would incentivize parties to 

submit information promptly, and that 

tolling any applicable time periods 

would give the Departments and 

certified IDR entities sufficient time to 

make such additional information 

requests without encroaching on other 

timeframes. 

The Departments seek comment on 

these proposals, including whether 

certified IDR entities should still be 

required to make a payment 

determination and provide notification 

of the payment determination to the 

parties not later than 30 business days 

after the date of final selection of the 

certified IDR entity, after a preceding 

timeframe in the process has been 

tolled, such as for an eligibility 

determination. 

d. Authority To Continue Negotiations 

or Withdraw 

i. Authority To Continue To Negotiate 

To correct an omission, HHS is 

proposing a non-substantive change to 

45 CFR 149.510(c)(3)(i) to add the term 

‘‘enrollee’’ to references to participants 

and beneficiaries. HHS is proposing to 

add the term ‘‘enrollee’’ to account for 

individuals who are enrolled in the 

individual health insurance market 

when referencing whose cost sharing 

must be considered as part of the total 

out-of-network rate agreed upon by both 

parties and to clarify who may not be 

billed for additional payments if the 

agreed upon out-of-network rate exceeds 

the QPA. 

ii. Withdrawals 

The Departments propose to add 26 

CFR 54.9816–8(c)(3)(ii), 29 CFR 

2590.716–8(c)(3)(ii), and 45 CFR 

149.510(c)(3)(ii) to establish a process 

for disputes to be withdrawn from the 

Federal IDR process. Under these 

proposed rules, a dispute may be 

withdrawn from the Federal IDR process 

by the initiating party, the Departments, 

or the certified IDR entity before a 

payment determination is made if any 

one of the following four conditions is 

met. Under the proposed new 26 CFR 

54.9816–8(c)(3)(ii)(A), 29 CFR 

2590.716–8(c)(3)(ii)(A), and 45 CFR 

149.510(c)(3)(ii)(A), the first condition 

would allow for withdrawal when the 

initiating party provides notification 

through the Federal IDR portal to the 

Departments and the certified IDR entity 

(if selected) that both parties to the 

dispute agree to withdraw the dispute 

from the Federal IDR process without 

agreement on an out-of-network rate. An 

initiating party generally should not be 

able to unilaterally withdraw a dispute 

once it is initiated because the noninitiating party may not wish to 

withdraw the dispute. Therefore, under 

these proposed rules, the notification 

must include the dispute number, a 

statement about both parties’ agreement 

to withdraw and authorized signatures 

from both parties. A withdrawal that is 

agreed to by both parties would remove 

disputes from the system in the most 

efficient manner without the need for 

additional outreach. 

The Departments also propose to add 

26 CFR 54.9816–8(c)(3)(ii)(B), 29 CFR 

2590.716–8(c)(3)(ii)(B), and 45 

CFR149.510(c)(3)(ii)(B), to allow for 

withdrawal when the initiating party 

provides a standard withdrawal request 

notice through the Federal IDR portal to 

the Departments, the certified IDR entity 

(if selected), and the non-initiating party 

of its request to withdraw the dispute 

from the Federal IDR process, and the 

non-initiating party notifies the 

Departments, certified IDR entity (if 

selected), and the initiating party 

through the Federal IDR portal of its 

agreement to withdraw from the Federal 

IDR process within 5 business days of 

the initiating party’s request. If the noninitiating party fails to respond within 

5 business days of the initiating party’s 

request, the non-initiating party would 

be considered to have agreed to the 

withdrawal, and the dispute would be 

withdrawn. The Departments propose 

adding withdrawal of a dispute in this 

situation to address circumstances in 

which the non-initiating party fails to 

respond because they are not engaging 

in the process. Permitting withdrawal of 

a dispute in such cases would decrease 

the number of payment determinations 

the certified IDR entity is required to 

adjudicate. These proposals strike a 

balance between fairness to the 

disputing parties and efficiency of the 

Federal IDR process by generally 

requiring mutual agreement by the 

disputing parties to withdraw the 

dispute but providing that the dispute 

would be withdrawn in the event the 

non-initiating party is nonresponsive 

within the specified timeframe. 

Under proposed new 26 CFR 

54.9816–8(c)(3)(ii)(C), 29 CFR 2590.716– 

8(c)(3)(ii)(C), and 45 CFR 

149.510(c)(3)(ii)(C), the third condition 

under which a dispute may be 

withdrawn is when a certified IDR 

entity or the Departments cannot 

determine eligibility because both 

parties are unresponsive to a request for 

additional information as described in 

proposed 26 CFR 54.9816–8(c)(2)(iii), 29 

CFR 2590.716–8(c)(2)(iii) and 45 CFR 

149.510(c)(2)(iii). In situations where 

neither party responds to the requested 

information, the Departments believe it 

appropriate for the dispute to be 

withdrawn because the certified IDR 

entity lacks the appropriate information 

to make the required eligibility 

determination properly and the parties 

are failing to engage in the process. 

Under proposed new 26 CFR 

54.9816–8(c)(3)(ii)(D), 29 CFR 

2590.716–8(c)(3)(ii)(D), and 45 CFR 

149.510(c)(3)(ii)(D), the fourth condition 

under which a dispute may be 

withdrawn is when the certified IDR 

entity cannot make a payment 

determination because both parties have 

failed to submit an offer as described in 

proposed 26 CFR 54.9816–8(c)(5)(i), 29 

CFR 2590.716–8(c)(5)(i) and 45 CFR 

149.510(c)(5)(i). The Departments are of 

the view that such disputes should be 

withdrawn from the Federal IDR process 

because under the statute, parties have 

ceased to participate in the Federal IDR 

process and failed to submit an offer 

that the certified IDR entity must select 

as the out-of-network payment amount. 

In addition, if neither party has 

submitted an offer, there is nothing from 


lotter on DSK11XQN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75781 

157Section 9816(c)(5)(A)(i) of the Code, section 

716(c)(5)(A)(i) of ERISA, and section 2799A– 

1(c)(5)(A)(i) of the PHS Act. 

158 In the July 2021 interim final rule (86 FR 

36890), the Departments defined the service code as 

the code that describes an item or service using the 

Current Procedural Terminology (CPT), Healthcare 

Common Procedure Coding System (HCPCS), and 

the Diagnosis-Related Group (DRG) codes. See also 

26 CFR 54.9816–6T(a)(14), 29 CFR 2590.716– 

6(a)(14), and 45 CFR 149.140(a)(14). 

159 42 U.S.C. 300gg–112(b)(1)(B), (c)(1). 

160The Departments propose a non-substantive 

amendment to 26 CFR 54.9816–8(c)(4)(i)(D), 29 CFR 

2590.716–8(c)(4)(i)(D), and 45 CFR 

149.510(c)(4)(i)(D) to correct the cross-reference to 

the cooling-off period from 26 CFR 54.9816– 

8T(c)(4)(vi)(B), 29 CFR 2590.716–8(c)(4)(vi)(B), and 

45 CFR 149.510(c)(4)(vi)(B) to 26 CFR 54.9816– 

8T(c)(5)(vii)(B), 29 CFR 2590.716–8(c)(5)(vii)(B), 

and 45 CFR 149.510(c)(5)(vii)(B). 

which the certified IDR entity may 

select.157

In addition to the proposals described 

in this section of the preamble, the 

Departments also propose technical 

revisions to the existing requirements 

for the authority to continue 

negotiations, which are currently set 

forth at 26 CFR 54.9816–8T(c)(2), 29 

CFR 2590.716–8(c)(2), and 45 CFR 

149.510(c)(2). These proposed rules 

would redesignate paragraph (c)(2) as 

(c)(3) and amend the title at current 

paragraph (c)(2) by adding to the end of 

it ‘‘or withdraw’’. 

The Departments seek comment on 

these proposals, including if there are 

other circumstances for which the 

Departments should consider a dispute 

withdrawn. 

2. Treatment of Batched Items and 

Services and Bundled Payment 

Arrangements 

The Departments propose revisions to 

the requirements for the treatment of 

batched items and services which are 

currently set forth at 26 CFR 54.9816– 

8T(c)(3)(i), 29 CFR 2590.716–8(c)(3)(i), 

and 45 CFR 149.510(c)(3)(i). However, 

as discussed in section I.D. of this 

preamble, the requirements at 26 CFR 

54.9816–8T(c)(3)(i)(C), 29 CFR 

2590.716–8(c)(3)(i)(C), and 45 CFR 

149.510(c)(3)(i)(C) have been vacated by 

the District Court in TMA IV order. The 

Departments also propose technical 

changes to the treatment of bundled 

payment arrangements, currently set 

forth at 26 CFR 54.9816–8T(c)(3)(ii), 29 

CFR 2590.716–8(c)(3)(ii), and 45 CFR 

149.510(c)(3)(ii). The batching and 

bundling payment proposals are 

informed by the Departments’ 

experience implementing the regulatory 

requirements on the batching of items 

and services related to the treatment of 

a similar condition and relevant 

feedback from interested parties, 

including comments submitted in 

response to the October 2021 interim 

final rules. 

a. Treatment of Batched Items and 

Services and Bundled Payment 

Arrangements Under Current and 

Vacated Rules 

Under the October 2021 interim final 

rules, multiple qualified IDR items and 

services were required to meet four 

conditions to be batched and considered 

as part of a single payment 

determination. First, the qualified IDR 

items and services must be billed by the 

same provider or group of providers, the 

same facility, or same provider of air 

ambulance services, which means the 

items and services must be billed under 

the same NPI or TIN. 

Second, the initial payment (or notice 

of denial of payment) for the items and 

services must be made by the same 

group health plan or health insurance 

issuer. The Departments clarified in 

August 2022 Technical Assistance for 

Certified IDR Entities that qualified IDR 

items or services can be batched if 

payment is made by the same issuer 

even if the qualified IDR items and 

services relate to claims from different 

fully-insured group or individual health 

plan coverage offered by the issuer; and 

that for self-insured group health plans, 

qualified IDR items or services can be 

batched only if payment is made by the 

same plan, even if the same TPA 

administers multiple self-insured plans. 

Third, the October 2021 interim final 

rules established that qualified IDR 

items and services were related to the 

treatment of a similar condition if the 

qualified IDR items and services were 

the same or similar items or services, 

meaning that those items and services 

are billed under the same service code 

with modifiers (if applicable), or billed 

under a comparable service code with 

modifiers (if applicable) under a 

different procedural code system.158

However, as discussed in section I.D. of 

this preamble, on August 3, 2023, the 

District Court vacated this provision on 

the grounds that it violated the noticeand-comment requirement of the 

Administrative Procedure Act. The 

TMA IV order vacated the parts of the 

August 2022 Technical Assistance for 

Certified IDR Entities that stated that 

multiple qualified IDR items or services 

may be batched in a single dispute if the 

qualified IDR items or services were 

billed under the same service code with 

modifiers, or billed under comparable 

codes with modifiers under different 

procedural code systems. Further, as 

discussed in section I.D. of this 

preamble, on August 24, 2023, the 

District Court vacated that portion of the 

August 2022 Technical Assistance for 

Certified IDR Entities on the basis that 

the guidance prohibits a single air 

ambulance transport, which is billed 

under two service codes (one for the 

base rate and one for the mileage rate), 

to be submitted as a single dispute, and 

instead required two separate disputes 

to be submitted. The District Court 

vacated this provision as a violation of 

the statute which defines each air 

ambulance transport as a single 

service.159

Fourth, all the qualified IDR items 

and services must have been furnished 

within the same 30-business-day period 

or the 90-calendar-day suspension 

period (also referred to as the ‘‘coolingoff period’’) under 26 CFR 54.9816– 

8T(c)(5)(vii)(B), 29 CFR 2590.716– 

8(c)(5)(vii)(B), and 45 CFR 

149.510(c)(5)(vii)(B).160 As stated in the 

preamble to the October 2021 interim 

final rules, for claims for an item or 

service for which the end of the open 

negotiation period occurs during the 90- 

calendar-day suspension period, after 

the end of the 90-calendar-day 

suspension period, either party may 

initiate the Federal IDR process for any 

item or service affected by the 

suspension. For these items or services, 

the initiating party must submit the 

notice of IDR initiation within 30 

business days following the end of the 

90-calendar-day suspension period, as 

opposed to the standard 4-business-day 

period following the end of the open 

negotiation period. The 30-business-day 

period begins on the day after the last 

day of the 90-calendar-day suspension 

period. 

Section 9816(c)(3)(B) of the Code, 

section 716(c)(3)(B) of ERISA, and 

section 2799A–1(c)(3)(B) of the PHS Act 

direct the Departments, as part of 

specifying criteria for batched disputes, 

to provide that qualified IDR items and 

services included by a provider or 

facility as part of a bundled payment 

may be part of a single determination. 

The October 2021 interim final rules 

specify that items and services may be 

submitted as a bundled payment 

arrangement when qualified IDR items 

and services are billed by a provider, 

facility, or provider of air ambulance 

services as part of a bundled payment 

arrangement, or where a plan or issuer 

makes or denies an initial payment as a 

bundled payment. The August 2022 

Technical Assistance for Certified IDR 

Entities clarified that for the purposes of 

the Federal IDR process, a bundled 

arrangement is an arrangement under 

which: (1) a provider, facility, or 

provider of air ambulance services bills 


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75782 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

161U.S. Department of Health and Human 

Services, U.S. Department of Labor, and U.S. 

Department of the Treasury. (August 2022). 

Technical Assistance for Certified IDR Entities. 

https://www.cms.gov/files/document/TA-certifiedindependent-dispute-resolution-entities-August2022.pdf. 

162An emergency medical condition is defined in 

the Emergency Medical Treatment and Active Labor 

Act (EMTALA) in part as: ‘‘a medical condition 

manifesting itself by acute symptoms of sufficient 

severity (including severe pain) such that the 

absence of immediate medical attention could 

reasonably be expected to result in placing the 

individual’s health [or the health of an unborn 

child] in serious jeopardy, serious impairment to 

bodily functions, or serious dysfunction of bodily 

organs.’’ 42 U.S.C. 1395dd(e)(1). 

163 In the August 2022 Technical Assistance for 

Certified IDR Entities, the Departments noted that 

plans and issuers generally calculate payment 

amounts for anesthesia services by multiplying the 

rate for the anesthesia conversion factor by (1) the 

base unit for the anesthesia service code, (2) the 

time unit, and (3) the physical status modifier unit. 

The base unit, time unit, and physical status 

modifier unit are specific to the individual 

receiving the anesthesia services. These base units 

are assigned to the services codes for anesthesia 

services, specifically CPT codes 00100 to 01999. 

for multiple items or services under a 

single service code; or (2) a plan or 

issuer makes an initial payment or 

notice of denial of payment to a 

provider, facility, or provider of air 

ambulance services under a single 

service code that represents multiple 

items or services (for example, a 

DRG).161 The Departments also 

specified that bundled payment 

arrangements submitted under 26 CFR 

54.9816–8T(c)(3)(ii), 29 CFR 2590.716– 

8(c)(3)(ii), and 45 CFR 149.510(c)(3)(ii) 

are subject to the rules for batched 

determinations and the certified IDR 

entity fee for single determinations. 

b. Feedback From Interested Parties on 

Current Batching Rules 

Since the publication of the October 

2021 interim final rules, the 

Departments have reviewed comments 

in response to the rules and continue to 

engage interested parties to identify 

opportunities for improvements in the 

Federal IDR process. In particular, the 

Departments have received substantial 

feedback from interested parties on the 

batching criteria that specifies how 

multiple qualified IDR items or services 

that relate to the treatment of a similar 

condition may be batched. Specifically, 

some providers of air ambulance 

services have expressed that the nowvacated batching rule finalized in the 

October 2021 interim final rules was 

burdensome because it prohibited a 

single air ambulance transport service 

from being the subject of a single 

dispute (for example, charges for fuel 

and mileage are two separate codes and 

could not be batched under the vacated 

batching rule). They highlighted that 

this essentially doubled their costs to 

dispute an out-of-network payment 

through the Federal IDR process. Some 

radiologists asserted that the vacated 

batching rule prohibited them from 

batching radiology items and services 

for multiple body parts for a single 

patient (for example, lumbar and 

thoracic spine) because these items and 

services are billed under different 

service codes, even though they may 

relate to a similar condition. They 

further asserted that, absent the ability 

to batch, radiologists are effectively 

denied access to the Federal IDR process 

because the reimbursements for most 

individual radiology codes are lowdollar and therefore are not costeffective to dispute individually. The 

Departments received similar feedback 

from other specialty providers, 

including laboratory and pathology 

physicians. Emergency physicians have 

stated that the nature of emergency care 

makes it difficult for them to batch 

claims under the vacated batching rule. 

For example, emergency physicians 

note that emergency care is 

characterized by a range of severity that 

patients present with, and a 

corresponding range of diagnostic, 

therapeutic, and decision-making 

intensity, which is different from 

scheduled surgery or office visits where 

the patient’s diagnosis or condition is 

most often explicitly known. For this 

reason, emergency physicians 

recommend that for the purpose of 

emergency physicians, the ‘‘condition’’ 

should be defined as ‘‘emergency 

medical care’’ or ‘‘EMTALA-related 

care’’ 162 and that limiting batching to 

individual ‘‘conditions’’ would result in 

a high number of disputes in the Federal 

IDR process, expense, and 

administrative burden. 

Anesthesiologists have recommended 

two different mechanisms by which 

claims for services should be able to be 

batched. First, anesthesiologists have 

stated that anesthesia services should be 

batched based on anesthesia code 

families. Anesthesia services are 

classified in a distinct code set in which 

CPT codes are grouped according to 

body parts (for example, head, neck, 

thorax, etc.). Anesthesiologists have 

highlighted that if they are not 

permitted to batch claims for services 

within a related body-part code group, 

they will be confronted with unique and 

significant administrative burdens in 

the Federal IDR process. Second, 

anesthesiologists have raised that they 

should be able to batch all claims with 

the same anesthesia conversion factor 

because this reflects industry practice. 

The conversion factor is the basis for 

their negotiations with payers for innetwork services; a payer generally 

contracts with an anesthesiologist or 

their group for payment for the full 

range of anesthesia services based upon 

a single, common anesthesia conversion 

factor (expressed in dollars per unit). 

Whether the anesthesia service is for a 

surgical procedure on the head, 

shoulder, arm, or leg, the anesthesia 

conversion factor for each service is the 

same 163 and the assigned base units 

vary based on the procedure and the 

time units vary as determined by actual 

time. 

The Departments also have received 

feedback from certified IDR entities 

regarding the batching rules and 

potential impacts of expanding 

batching. Certified IDR entities have 

indicated that disputes involving 

batched items and services under the 

current and now-vacated rules are more 

administratively burdensome than nonbatched disputes, often due to the extra 

time and resources they must expend in 

verifying that the items and services are 

properly batched and eligible for the 

Federal IDR process. Further, certified 

IDR entities have stated that a 

substantial portion of the time and 

expense related to resolving disputes is 

spent on these administrative and 

eligibility-related tasks; and once the 

dispute reaches the certified IDR 

entities, they are able to make the 

substantive payment determinations 

relatively efficiently. However, in 

providing feedback to the Departments 

on ways to improve batching in the 

Federal IDR process, certified IDR 

entities signaled that processing batched 

disputes would become substantially 

more difficult if broad categories of 

items and services could be submitted 

to the Federal IDR process in a single 

batched dispute. This is because, in 

addition to adding further complexity to 

the eligibility review process, certified 

IDR entities would also need to closely 

review the potentially unique factual 

circumstances of each item and service 

contained within the batch in making 

the payment determination. This could 

include differing evidence of the 

additional circumstances described in 

section 9816(c)(5)(C) of the Code, 

section 716(c)(5)(C) of ERISA, and 

section 2799A–1(c)(5)(C) of the PHS Act 

for each batched item and service. 

Certified IDR entities recommended 

implementing a cap on the number of 

qualified IDR items and services (or 

‘‘line items’’) included in batched 

disputes in order to ensure that they can 

resolve payment determinations within 

the 30-business-day requirement. 

Specifically, many certified IDR entities 


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164Section 9816(c)(3)(A)(iv) of the Code, section 

716(c)(3)(A)(iv) of ERISA, and section 2799A– 

1(c)(3)(A)(iv) of the PHS Act. 

165Under this notice of proposed rulemaking, the 

Departments propose new requirements related to 

the treatment of batched items and services and 

bundled payment arrangements. While the 

Departments consider and discuss feedback from 

interested parties in the context of these new 

proposals, they do not specifically address all 

public comments on batching and bundling 

received in response to the October 2021 interim 

final rule. 

suggested imposing a 25-line-item cap 

on the number of items and services that 

could be submitted in a batched 

dispute, to the extent factual 

circumstances among them differed. 

Some certified IDR entities mentioned 

that the necessary line-item cap would 

depend on how the parties would be 

permitted to batch items and services; 

however, certified IDR entities generally 

indicated that in any circumstance, it 

would not be feasible to resolve 

disputes in excess of 100 items and 

services within the 30-business-day 

period for making payment 

determinations. Certified IDR entities 

indicated they could manage batched 

claims containing a larger number of 

items and services (for example, 25 to 

50) to the extent they involved the same 

type of claim and when the relevant 

facts are identical across the items or 

services in the batch. For example, some 

certified IDR entities stated that 

batching items and services from a 

single patient encounter and claim 

would be manageable and create 

efficiencies. However, certified IDR 

entities maintained that once the line 

items included in a batch reach a certain 

number, efficiencies are lost, and the 

batched dispute becomes 

unmanageable. 

Plans and issuers have also indicated 

that the relatively frequent submission 

of incorrectly batched items and 

services as a single dispute by providers 

and facilities poses a substantial 

administrative burden for them. This is 

because the initiating party may need to 

resubmit the dispute, which, under the 

current rules, could also result in the 

non-initiating party paying the 

applicable administrative fee, 

potentially multiple times. Such 

interested parties urged the Departments 

to avoid adding further complexity or 

ambiguity with respect to the ability to 

batch items and services. 

c. Proposals To Improve Batching in the 

Federal IDR Process 

After considering comments and 

feedback from interested parties 

(including certified IDR entities, plans 

and issuers, providers, facilities, and 

providers of air ambulance services), 

and the Departments’ general 

experience with operationalizing the 

Federal IDR process to date, the 

Departments are of the view that, under 

some circumstances, allowing multiple 

qualified IDR items and services that 

treat a similar condition to be batched 

together in a single payment 

determination proceeding, in 

accordance with the requirements of 26 

CFR 54.9816–8T(c)(3)(i), 29 CFR 

2590.716–8(c)(3)(i), and 45 CFR 

149.510(c)(3)(i), encourages efficiency 

and can result in cost savings for 

disputing parties.164

In these proposed rules, the 

Departments are proposing new 

batching provisions that are intended to 

achieve a balance among several 

important objectives, including ensuring 

the batching rules do not unreasonably 

impede parties’ access to the Federal 

IDR process considering relative costs 

and administrative burden, and 

simplifying Federal IDR process 

operations while avoiding new 

operational complexities that could 

create or exacerbate dispute backlogs. 

The Departments are of the view that 

the proposed provisions would help 

ensure that qualified IDR items and 

services included in batched 

determinations have clear definitional 

principles that would yield logical 

payment determinations across certified 

IDR entities, including determinations 

of whether items or services are 

properly submitted as batched 

determinations. The Departments are 

also of the view that these proposals 

would reduce potential risk that large 

and complicated batches would extend 

the time needed for certified IDR 

entities to make eligibility and payment 

determinations.165 In addition to these 

proposals, the Departments are 

considering altering current guidance on 

the resubmission of incorrectly batched 

disputes. In the August 2022 Technical 

Assistance for Certified IDR Entities, the 

Departments stated that inappropriately 

batched or bundled disputes may be resubmitted as properly batched or single 

disputes if the qualified IDR items and 

services that are subject to the disputes 

meet all other applicable requirements, 

including requirements for timely 

initiation of the Federal IDR process. 

The Departments are considering 

removing this flexibility 90 business 

days after the proposed batching 

provisions, as finalized, would become 

applicable. This would allow parties 

time to adjust to the new proposed 

batching rules, if finalized. 

i. Treatment of Batched Items and 

Services 

The Departments first propose to 

redesignate paragraph (c)(3) as 

paragraph (c)(4) under 26 CFR 54.9816– 

8, 29 CFR 2590.716–8, and 45 CFR 

149.510. Newly redesignated paragraph 

(c)(4)(i) of these sections would provide 

that up to 25 qualified IDR items and 

services may be batched and considered 

jointly as part of one payment 

determination only if all requirements 

under paragraphs (c)(4)(i)(A) through 

(D) are met. 

A. Line-Item Limit for Batched Items 

and Services 

The Departments propose to limit 

batched determinations to 25 line items 

in a single dispute. Without such a 

limit, the additional batching provisions 

in these proposed rules could increase 

the time and level of effort certified IDR 

entities spend on resolving payment 

determinations, which, in turn, would 

hinder their ability to make timely 

payment determinations. The 

Departments must ensure that the 

Federal IDR process operates efficiently, 

as section 9816(c)(3)(A) of the Code, 

section 716(c)(3)(A) of ERISA, and 

section 2799A–1(c)(3)(A) of the PHS Act 

direct the Departments to ‘‘specify 

criteria under which multiple qualified 

IDR dispute items and services are 

permitted to be considered jointly as 

part of a single determination by an 

entity for purposes of encouraging the 

efficiency (including minimizing costs) 

of the IDR process.’’ The Departments, 

therefore, and in line with the feedback 

from certified IDR entities discussed in 

section II.E.2.b of the preamble, propose 

a 25-line-item limit as a reasonable cap 

to ensure that large and complicated 

batches do not extend the timeframe 

needed for certified IDR entities to make 

eligibility and payment determinations. 

Further, a 25-line-item limit is intended 

to help ensure that certified IDR entities 

are able to reasonably forecast and cover 

their costs through the fees they set for 

batched disputes and to process batched 

disputes in a more timely manner. 

The Departments seek comment on 

the proposed limit on the number of 

qualified IDR items and services in a 

batched determination and whether an 

alternative line-item limit that is higher 

or lower than 25 line items would be 

more appropriate to promote 

efficiencies and cost savings in the 

Federal IDR process. The Departments 

are considering whether a 50-line-item 

limit is a more reasonable cap to 

encourage efficiencies for disputing 

parties, while still allowing certified 

IDR entities sufficient time to review the 


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166Section 9816(c)(3)(A) of the Code, section 

716(c)(3)(A) of ERISA, and section 2799A–1(c)(3)(A) 

of the PHS Act. 

eligibility of batched disputes and make 

payment determinations within the 30- 

business-day requirement. The 

Departments also solicit comment on 

whether the line-item limit should vary 

depending on the type of batched 

dispute. For example, there could be a 

25-line-item limit for items and services 

furnished to a single patient on the same 

or consecutive dates of service and 

billed on the same claim, and a 50-lineitem limit for items and services 

furnished to one or more patients under 

the same service code. 

The Departments also seek comment 

on whether a line-item limit should be 

imposed and whether and how such a 

provision could increase efficiency and 

process disputes in a more timely 

manner. The Departments also solicit 

comment on whether the certified IDR 

entity fee structure for batched 

determinations should be adjusted given 

the proposed changes to the batching 

rules. 

B. Batched Items and Services Must Be 

Billed by the Same Provider, Facility, or 

Provider of Air Ambulance Services 

The Departments propose to 

redesignate 26 CFR 54.9816– 

8(c)(3)(i)(A), 29 CFR 2590.716– 

8(c)(3)(i)(A), and 45 CFR 

149.510(c)(3)(i)(A) as 26 CFR 54.9816– 

8(c)(4)(i)(A), 29 CFR 2590.716– 

8(c)(4)(i)(A), and 45 CFR 

149.510(c)(4)(i)(A), respectively. The 

Departments propose no substantive 

changes to this provision, which 

provides that qualified IDR items and 

services may be considered as part of a 

single batched determination only 

where they were billed by the same 

provider or group of providers, the same 

facility, or the same provider of air 

ambulance services. The provision also 

provides that qualified IDR items and 

services are billed by the same provider 

or group of providers, the same facility, 

or the same provider of air ambulance 

services if the items or services are 

billed with the same NPI or TIN. This 

provision reflects the first of four 

statutory requirements that must be 

satisfied for a qualified IDR item or 

service to be considered as part of a 

batched determination.166

C. Batched Items and Services Must Be 

Paid by the Same Plan or Issuer 

Under proposed 26 CFR 54.9816– 

8(c)(4)(i)(B), 29 CFR 2590.716– 

8(c)(4)(i)(B), and 45 CFR 

149.510(c)(4)(i)(B), the Departments 

propose that qualified IDR items and 

services may be batched and considered 

jointly as part of one payment 

determination if payment for the 

qualified IDR items and services is made 

by the same group health plan or health 

insurance issuer. Because the 

Departments have received questions 

about how to batch for claims involving 

group health plans that are fully-insured 

versus self-insured, the proposed rules 

specify that this requirement would be 

satisfied if the same issuer is required to 

make payment for the qualified IDR 

items and services, even if the qualified 

IDR items and services relate to claims 

from different group health plans or 

individual market policies. For selfinsured group health plans, this 

requirement would be satisfied if the 

same self-insured group health plan is 

required to make payment for the 

qualified IDR items and services, 

including when the plan makes 

payments through a TPA: the 

requirement would not be satisfied if 

multiple self-insured group health plans 

are required to make payments for the 

qualified IDR items and services, even if 

those group health plans make 

payments through the same third party 

administrator. While a given TPA may 

administer multiple self-insured plans, 

the self-insured group health plan 

generally is the responsible party for 

payment or reimbursement of the 

qualified IDR items and services. 

D. Batched Items and Services Must Be 

Related to the Treatment of a Similar 

Condition 

The Departments propose to add 26 

CFR 54.9816–8(c)(4)(i)(C), 29 CFR 

2590.716–8(c)(4)(i)(C), and 45 CFR 

149.510(c)(4)(i)(C) to permit initiating 

parties to batch qualified IDR items and 

services in specific circumstances, so 

long as the items and services relate to 

the treatment of a similar condition and 

the batching of the items and services 

would encourage efficiency (including 

minimizing costs) in the Federal IDR 

process. As the Departments explained 

earlier in section II.E.2. of this preamble, 

the Departments are proposing new 

batching criteria for multiple qualified 

IDR items and services that relate to the 

treatment of a similar condition in an 

effort to ensure the Federal IDR process 

is efficient and economically feasible for 

providers, facilities, providers of air 

ambulance services, plans, and issuers. 

The Departments must also ensure that 

the Federal IDR process operates 

efficiently, as section 9816(c)(3)(A) of 

the Code, section 716(c)(3)(A) of ERISA, 

and section 2799A–1(c)(3)(A) of the PHS 

Act directs the Departments to ‘‘specify 

criteria under which multiple qualified 

IDR dispute items and services are 

permitted to be considered jointly as 

part of a single determination by an 

entity for purposes of encouraging the 

efficiency (including minimizing costs) 

of the IDR process.’’ However, there is 

a threshold number of items and 

services in a single batch at which that 

batch becomes so large that no 

efficiencies are gained, and an 

additional burden is imposed on the 

certified IDR entity, as discussed in 

section II.E.2.i.A. of this preamble 

(regarding line-item limits). Therefore, 

the Departments do not intend for the 

additional flexibility proposed under 

these rules to be unlimited or available 

in circumstances that would not 

promote efficiency in the Federal IDR 

process. The Departments propose four 

circumstances under which qualified 

IDR items and services would be 

considered to relate to the treatment of 

a similar condition such that a certified 

IDR entity’s consideration of the items 

and services in a single payment 

determination would promote efficiency 

in the Federal IDR process. 

Under new 26 CFR 54.9816– 

8(c)(4)(i)(C)(1), 29 CFR 2590.716– 

8(c)(4)(i)(C)(1), and 45 CFR 

149.510(c)(4)(i)(C)(1), the Departments 

propose that qualified IDR items and 

services would be considered to relate 

to the treatment of a similar condition 

and encourage efficiency in the Federal 

IDR process when they were furnished 

to a single patient during the same 

patient encounter. For purposes of these 

proposed regulations, the Departments 

propose to define a single patient 

encounter as a patient encounter on one 

or more consecutive days during which 

the qualified IDR items or services were 

furnished to the same patient and billed 

on the same claim form. 

The Departments understand from 

engagement with providers, medical 

coding professionals, and certified IDR 

entities that while there may be some 

instances where a patient is treated for 

two or more unrelated or dissimilar 

conditions during a single patient 

encounter, in general, items and 

services furnished during a patient 

encounter and billed by the same 

provider, facility, or provider of air 

ambulance services on one claim form 

tend to relate to the treatment of the 

same or similar condition. The 

Departments are of the view that the 

proposed definition of a single patient 

encounter would promote efficiency by 

avoiding the requirement that an 

initiating party file separate disputes to 

obtain payment determinations for each 

of the items and services that were part 

of a single claim and patient encounter. 

Allowing qualified IDR items or 

services to be included in a batched 


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determination when they were 

furnished to the same patient on one or 

more consecutive days and billed on the 

same claim form would simplify and 

encourage efficiency of the Federal IDR 

process. For example, evidence of the 

additional circumstances described in 

section 9816(c)(5)(C) of the Code, 

section 716(c)(5)(C) of ERISA, and 

section 2799A–1(c)(5)(C) of the PHS Act 

would generally be identical for each 

qualified IDR item and service furnished 

during a single patient encounter. This 

would limit the burden on certified IDR 

entities considering such additional 

circumstances and making a payment 

determination for the batch. In addition, 

permitting batching of items and 

services furnished to a single patient 

during the same patient encounter 

would help the non-initiating party 

more readily identify the claims 

involved since the dispute submitted by 

the initiating party to the Federal IDR 

process would relate to a single claim 

form in the non-initiating party’s 

records, as opposed to having to locate 

and review multiple claim forms. 

The Departments note that the 

proposed requirement to permit 

batching by patient encounter would 

increase procedural efficiency compared 

to the vacated batching provision for 

providers of air ambulance services by 

allowing them to submit a single 

dispute for a patient’s air ambulance 

transport (provided the other batching 

requirements are met). This approach is 

consistent with the TMA III order and 

opinion, which vacated provisions of 

the August 2022 Technical Assistance 

for Certified IDR Entities that in effect 

required each air ambulance service 

code to be submitted as a single dispute, 

requiring two separate IDR disputes for 

a single air ambulance transport. Under 

these proposed rules, mileage and base 

rates, as well as any other item or 

service furnished during a single air 

transport and billed for on the same 

claim form, could be batched in a single 

payment determination. The 

Departments request comment on this 

proposal, including any data or other 

information that supports or contradicts 

the Departments’ understanding 

underlying this proposal. 

At new 26 CFR 54.9816– 

8(c)(4)(i)(C)(2), 29 CFR 2590.716– 

8(c)(4)(i)(C)(2), and 45 CFR 

149.510(c)(4)(i)(C)(2), the Departments 

would reestablish the provision that 

qualified IDR items and services also 

would be considered to relate to the 

treatment of a similar condition and 

encourage efficiency when they were 

furnished to one or more patients during 

different patient encounters and were 

billed under the same service code or a 

comparable code under a different 

procedural code system, such as CPT 

codes with modifiers, if applicable, 

Healthcare Common Procedure Coding 

System (HCPCS) with modifiers, if 

applicable, or DRG codes with 

modifiers, if applicable. As discussed in 

section I.D. of this preamble, in TMA IV, 

the District Court’s decision vacated this 

previously established provision only 

on the grounds that it violated the 

notice-and-comment requirement under 

the Administrative Procedure Act and 

did not address whether this criterion is 

a reasonable interpretation of the No 

Surprises Act. 

Qualified IDR items or services billed 

under the same code or under 

comparable codes of different coding 

systems would be considered to 

generally relate to treatment of a similar 

condition because they essentially 

would be the same item or service. For 

example, CPT code 93000 and HCPCS 

code G0403 both correspond to a 

routine electrocardiogram (with 12 

leads). The proposal would simplify and 

encourage the efficiency of the Federal 

IDR process by retaining a clearly 

defined methodology for disputing 

parties and certified IDR entities to 

determine whether qualified IDR items 

and services are appropriately batched, 

which would contribute to the 

efficiency and consistency of such 

determinations across certified IDR 

entities. However, the Departments 

request comment on whether there are 

circumstances in which a single 

provider, facility, or provider of air 

ambulance services—as a practical 

matter—would bill for the same 

qualified IDR item or service using 

different code sets or whether the 

proposed flexibility could potentially 

incentivize billing practices specifically 

intended to circumvent these batching 

rules or other requirements of the 

Federal IDR process. The Departments 

request comment on this proposal, 

including any data or other information 

that supports or contradicts the 

Departments’ understanding underlying 

this proposal. 

Some interested parties have 

suggested that the Departments should 

deem all qualified IDR items and 

services within the same major CPT 

Category I codes or ‘‘family’’ to relate to 

the treatment of similar conditions. 

These sub-categories include Evaluation 

and Management, Anesthesia, Surgery, 

Radiology/Diagnostic Radiology/ 

Diagnostic Ultrasound, Pathology and 

Laboratory/Proprietary Laboratory 

Analysis, and Medicine. The 

Departments seek to balance the breadth 

of the interpretation of the statutory 

requirement that batched items and 

services relate to the treatment of a 

‘‘similar condition’’ with the goal of 

efficiency. The Departments have heard 

from certified IDR entities that 

significant variability among items or 

services in a batched claim often leads 

to payment determinations that are 

significantly more time-intensive and 

burdensome to review than claims for 

items and services that are significantly 

similar. Efficiency in making eligibility 

and payment determinations is affected 

by several factors including the payer, 

the provider, the circumstances of each 

patient’s treatment, and the QPA for the 

items and services under dispute. 

Grouping larger numbers of items and 

services together into a single batch can 

lower costs to the extent that it 

minimizes effort on the part of the 

certified IDR entity in evaluating factors 

related to the dispute or disputing 

parties, such as eligibility for the 

Federal IDR process. However, larger 

batches of services with greater 

variability can also increase review time 

and costs of certified IDR entities, 

because larger batches that include 

disparate services and patient 

circumstances associated with different 

supporting information submitted by 

disputing parties, require certified IDR 

entities to analyze more information, 

often taking longer to review. For 

example, if the Departments permitted 

batching across the entirety of the 

Category I CPT code subcategory for 

radiology, an individual dispute could 

contain an X-ray of the eye for detection 

of a foreign body (CPT code 70030), a 

bilateral screening mammography (CPT 

code 77067), and simple intensity 

modulated radiation treatment (IMRT) 

delivery (CPT code 77385). These 

services would have different 

circumstances for the treatment of the 

patient and would result in the certified 

IDR entity evaluating a unique set of 

factors and supporting documentation 

for each of these services, thus reducing 

the ability of the certified IDR entity to 

make timely payment determinations 

for such disputes. 

The Departments are of the view that 

the variability of the conditions 

represented within the CPT Category I 

sub-categories would reduce, rather 

than promote greater efficiency of the 

Federal IDR process and would be less 

likely to relate to the treatment of a 

similar condition. Thus, the 

Departments propose to specify in 

guidance ranges of CPT codes within 

sub-categories of CPT Category I codes 

that may be batched, in order to 

promote efficiency in the Federal IDR 

process. Specifically, the Departments 

propose at 26 CFR 54.9816– 


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8(c)(4)(i)(C)(3), 29 CFR 2590.716– 

8(c)(4)(i)(C)(3), and 45 CFR 

149.510(c)(4)(i)(C)(3) that for 

anesthesiology, radiology, pathology, 

and laboratory qualified IDR items and 

services, items and services would be 

considered to relate to the treatment of 

similar conditions when they are 

furnished to one or more patients and 

were billed under service codes 

belonging to the same Category I CPT 

code ranges, which would be specified 

in guidance published by the 

Departments. 

The Departments propose to divide 

Category I CPT codes into ranges based 

on the Departments’ characterization of 

those codes as being related to the 

treatment of a similar condition. In 

Tables 2 through 4, the Departments 

detail proposed ranges of Category I CPT 

sub-categories for anesthesiology, 

radiology, pathology, and laboratory 

items or services that an initiating party 

may batch together within a single 

dispute (provided the other batching 

requirements are met). Under this 

proposal, the Departments would permit 

batching only of codes within these 

ranges for anesthesiology, radiology, 

pathology, and laboratory qualified IDR 

items and services. By allowing for the 

more narrowly defined Category I CPT 

code spans for batched determinations 

indicated in Tables 2 through 4, the 

Departments could increase the 

probability that the items or services in 

a dispute both relate to the treatment of 

a similar condition and increase the 

efficiency of the Federal IDR process, 

since the associated items or services 

would share the clinical commonality of 

pertaining to patients who require 

diagnostic imaging, radiation oncology, 

similar laboratory tests, etc. 

If these proposed rules are finalized, 

the Departments would establish 

descriptions of each sub-category of CPT 

codes, and update periodically as 

necessary the allowable ranges of 

service codes belonging to the same CPT 

sub-category for purposes of batching 

under proposed 26 CFR 54.9816– 

8(c)(4)(i)(C)(3), 29 CFR 2590.716– 

8(c)(4)(i)(C)(3), and 45 CFR 

149.510(c)(4)(i)(C)(3) in guidance. CPT 

codes are defined in the American 

Medical Association’s (AMA’s) ‘‘CPT 

Manual,’’ which is updated and 

published annually. The AMA releases 

the CPT manual in the fall of each year 

to precede their January 1st effective 

date. The Departments would review 

the modifications made to the CPT 

manual once available and determine if 

the modifications necessitate updates to 

the Category I CPT code spans for 

batched determinations based on the 

Departments’ interpretation of the preexisting descriptive categories with 

which a new Category I CPT code most 

closely aligns. For example, if a new 

CPT manual established a new Category 

I CPT code for diagnostic radiology 

(imaging) that would fall outside of CPT 

code spans 70010–71555, the 

Departments would need to release 

updated guidance for batched 

determinations to advise parties of 

which pre-existing descriptive 

categories of CPT code spans most 

closely align with the new code, and, 

thus, with which it can be batched. In 

such circumstances, the Category I CPT 

code spans for batched determinations 

most recently established by the 

Departments would stand until the 

publication of further guidance. 

BILLING CODE 6325–63–P; 4830–01–P; 4510–29–P; 

4120–01–P; 


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TABLE 2: Proposed Radiology CPT Code Spans for Permissible Batched DeterminationsLevel I HCPCS Codes (CPT) 

Code Span Description 

Level I HCPCS Codes 

(CPT) 

Diagnostic Radiology 

(Imaging) 

70010-71555 Head and Neck, Chest 

72020 - 72295 Spine and Pelvis 

73000 - 73725 Unner Extremities, Lower Extremities 

Diagnostic Radiology 74018 - 74363 Abdomen, Gastrointestinal Tract 

(Imaging) 74400 - 74775 Urinary Tract, Gvnecological and Obstetrical 

75557 - 75989 Heart, Vascular 

76000 - 76499 Other Procedures 

R0070 - R0076 Transportation, Portable Radiology Equipment 

Diagnostic Ultrasound 

-76506 - 76642 Head and Neck, Chest 

76700 - 76776 Abdomen and Retroperitoneum 

Diagnostic Ultrasound -76800 - 76873 Spinal Canal, Pelvis, Genitalia 

76881 - 76886 Extremities 

76392 - 76965 Ultrasonic Guidance Procedures 

76975 - 76999 Other Procedures 

Radiologic Guidance 

7700 I - 77003 Fluoroscopic Guidance 

Radiologic Guidance 77011 - 77014 CT Guidance 

77021 - 77022 MRI Guidance 

Breast Mammoe:raohv 

Breast Mammography 77076 - 77067 Mammography 

Bone/Joint Studies 

Bone/Joint Studies -77071 - 77092 Bone/Joint Studies 

Radiation Oncoloe:v 

77261 - 77370 Clinical Treatment Planning, Medical Radiation 

Physics 

Stereotactic Radiation Treatment Delivery, Other, 

77371 - 77425 Radiation Treatment Delivery, Neutron Beam 

Radiation Oncology Radiation Delivery 

-77427 - 77499 Radiation Treatment Management 

77520 - 77525 Proton Beam Treatment Delivery 

-77600 - 77620 Hyperthermia, Clinical Intracavitarv Hyperthermia 

-77750 - 77799 Clinical Brachytherapy 

Nuclear Medicine 

Nuclear Medicine 78012 - 78999 Diagnostic Nuclear Medicine 

79005 - 79999 Therapeutic Nuclear Medicine 
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TABLE 3: Proposed Pathology and Laboratory CPT Code Spans for Permissible Batched 

Determinations 

Code Span Description 

Level I HCPCS Codes 

(CPT) 

Pathology and Laboratory 

Diagnostic Radiology (Imaging) 

80047 - 80081 Organ or Disease Oriented Panels" 

80305 - 80377, 83992, 80143 - Drug Assay, Therapeutic Drug Assay 80299 

80400 - 80439 Evocative Suooression Testing 

80503 - 80506 Pathology Clinical Consultations, Molecular 

Pathology 

81105-81383 Molecular Pathology Tier I 

81400- 81408, 81479 Molecular Pathology Tier II 

Genomic Sequencing and Other Molecular 

81410 - 81471, 81490- 81599 Multianalyte Assays, Multianalyte Assays 

with Algorithmic Analysis 

81000 - 81099 Urinalvsisb 

82009 - 84999 Chemistry0 

85002 - 85999 Hematology and Coagulation 

86015 - 86849, -86850 - 86999 Immunology Transfusion Medicine 

87003 - 87999 Microbiology 

88104- 88199, -88230 - 88299 Cytopathology and cytogenetic studies 

88000 - 88099 Anatomic Pathology 

88300 - 88399 Surgical Pathology 

88720 - 88749, -89049 - 89240 In Vivo, Other Procedures 

89250 - 89398 Reproductive Medicine Procedures 

000lU - 0284U Proorietarv Laboratorv Analvsis 

Laboratory Tests of Blood and Hair, Pap 

P2028 - P2038, P3000 - P3001, Smears, Urine Bacterial Culture and 

P7001, P9603 - P9604, P9612 - Sensitivity Studies, Specimen Collection 

P9615 Travel Allowance, Specimen Collection, 

Catheterization 

P9010 - P9100 Blood and Blood Products 

•; The Departments note that organ or disease-oriented panels, urinalysis, and chemistry CPT codes could also be combined. The 

Departments understand that these are frequently-billed codes, and that such high volume would be a reason to not combine these 

three code-span ranges together. 

b/ Id. 

0/ Id. 
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BILLING CODE 6325–63–C; 4830–01–C; 4510–29–C; 

4120–01–C; 

Another goal of this proposal is to 

ensure that the batching rules facilitate 

access to the Federal IDR process 

considering the relative costs and 

administrative burden associated with 

participating. Consistent with feedback 

from interested parties, this proposal 

would also allow providers of lowerdollar qualified IDR items and services, 

such as providers of radiology, 

pathology, and laboratory items or 

services, to batch more services than 

was permitted under the October 2021 

interim final rules, because such 

qualified IDR items and services may 

not be cost-effective to dispute 

individually. 

As discussed earlier in section II.E.2.c 

of this preamble, the Departments are 

proposing new batching provisions to 

ensure the batching rules do not 

unreasonably impede the parties’ access 

to the Federal IDR process considering 

relative costs and administrative 

burden. The Departments intend these 

provisions to improve the efficiency of 

the Federal IDR process while avoiding 

new operational complexities that could 

create or exacerbate dispute backlogs. 

The proposed rule would provide new 

flexibility in two ways: first, it would 

allow initiating parties to batch all items 

and services related to a single patient 

encounter; second, it would allow 

batching of certain items and services 

within the same Category I CPT code 

sub-sections. For the purposes of this 

proposal, the Departments are primarily 

focusing on provider specialties that 

have been involved in a majority of 

disputes under the Federal IDR process, 

with one exception (emergency 

medicine, discussed in further detail 

below). The Departments solicit 

comment on whether there are other 

Category I CPT code subsections (for 

example, Medicine and Surgery) that 

would satisfy the statutory requirements 

that batched items and services relate to 

the treatment of a similar condition and 

encourage efficiency of the Federal IDR 

process. Although batching of items and 

services within the same Category I CPT 

code subsection is not available for all 

medical specialties, the Departments are 

of the view that the proposed batching 

provisions that would allow batching 

for a single patient encounter would 

improve efficiency of the Federal IDR 

process for medical, surgical, and 

emergency providers. 

As discussed in section II.E.2.b. of 

this preamble, emergency providers 

have recommended that the 

Departments permit batching of the 

most common evaluation and 

management CPT codes (99281–99285) 

for items and services furnished in 

emergency departments. After 

considering this feedback, the 

Departments are concerned that the 

variability of the conditions that are 

represented across the emergency 

medicine evaluation and management 

CPT codes would increase the 

likelihood for dissimilar conditions and 

patient acuities to be batched, which 

would be inefficient and highly 

burdensome for certified IDR entities. 

For instance, if these five different 

emergency medicine evaluation and 

management codes could be batched 

together, the conditions represented in 


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(CPT) 

TABLE 4: Proposed Anesthesiology CPT Code Spans for Permissible Batched 

Determinations 

Code Soan Descriotion 

Level I HCPCS Codes 

Anesthesiology 

00100 - 01999 Anesthesia 

00100 - 00222 Head 

00300 00352 Neck 

00400 00474 Thorax (Chest Wall and Shoulder Girdle) 

00500 00580 Intrathoracic 

00600 00670 Spine and Spinal Cord 

00700 00797 Uoper Abdomen 

00800 00882 Lower Abdomen 

00902 00952 Perineum 

01112 01173 Pelvis (Except Hip) 

01200 01274 Upper Leg (Except Knee) 

01320 01444 Knee and Popliteal Area 

01462 01522 Lower Leg (Below knee, Includes Ankle and 

Foot) 

01610 01680 Shoulder and Axil la 

01710 01782 Upper Arm and Elbow 

01810 01860 Forearm, Wrist and Hand 

01916 01942 Radiological Procedures 

01951 01953 Bum Excisions or Debridement 

01958 01969 Obstetric 

01990 01999 Other Procedures 
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one batched dispute could include such 

diverse situations as a patient evaluated 

for an insect bite and one patient treated 

for a heart attack. The Departments seek 

comment on whether there are ways to 

provide additional batching flexibility 

for emergency department services in a 

way that mitigates the Departments’ 

concerns that such flexibility would 

increase the likelihood that claims for 

treatment of dissimilar conditions 

would be batched and promotes the 

efficiency of the IDR process, for 

example, data or estimates related to a 

potential decrease in the number of 

disputes involving emergency 

department services that would be 

realized if emergency department 

providers were permitted to batch items 

and services across the five evaluation 

and management Level I CPT codes, 

without a commensurate increase in the 

diversity of documentation that certified 

IDR entities would need to review to 

evaluate disputes related to different, 

but similar conditions. 

The Departments seek comment on 

the proposal to permit anesthesiology, 

radiology, pathology, and laboratory 

qualified IDR items and services that 

were furnished under service codes 

belonging to the same Category I CPT 

code section, as specified in guidance 

published by the Departments, 

including the proposed Category I CPT 

code spans for batched determinations, 

and whether there are any items and 

services similar to pathology, radiology, 

and laboratory qualified IDR items and 

services to which this policy should 

apply. For example, the Departments 

seek comment on whether additional 

batching flexibility, consistent with the 

statutory requirements, is necessary or 

appropriate for providers of lower-dollar 

items or services other than laboratory, 

pathology, or radiology services, to 

remove impediments and promote 

reasonable access to the Federal IDR 

process. The Departments also request 

comment on the proposed pathology 

and laboratory Category I CPT code 

spans for batched determinations. 

Specifically, the Departments solicit 

comment on whether Organ or Disease 

Oriented Panels, Urinalysis, and 

Chemistry Category I CPT codes should 

be combined for batched 

determinations. The Departments 

understand that these are frequently 

billed codes, and that such high volume 

would be a reason to not combine these 

three code-span ranges together. The 

Departments seek comment on this 

assumption, including any data or other 

information that supports or contradicts 

the Departments’ understanding, such 

as if the volume of these codes for outof-network services would be 

substantially less. 

Further, consistent with feedback 

from anesthesiologists, this proposal 

would allow anesthesiologists to batch 

items and services within a related 

body-part code group, which would 

align with the established framework in 

the field. Anesthesiologists have 

expressed to the Departments that while 

an anesthesia service for one spinal 

procedure may be related to multiple 

different medical conditions, the 

anesthesia administration itself is 

substantially similar. For example, for 

spinal procedures, the anesthesia 

service may be related to different 

spinal conditions such as stenosis or 

discectomy. Since the anesthesia 

administration itself is substantially 

similar for these different conditions, 

the Departments are of the view that 

these conditions could be considered 

similar and that the payment 

considerations a certified IDR entity 

would evaluate are similar. 

As discussed in section II.E.2.b. of 

this preamble, anesthesiologists have 

requested that claims be batched by the 

same conversion factor, since 

contracting practices for anesthesiology 

items and service focus on conversion 

factor rates, and not traditional codes 

like CPT codes. The Departments have 

not identified a basis upon which such 

conversion factor rates would satisfy the 

statutory requirement that batched items 

and services relate to a similar condition 

at section 9816(c)(3)(A)(iii) of the Code, 

section 716(c)(3)(A)(iii) of ERISA, and 

section 2799A–1(c)(3)(A)(iii) or how 

conversion factors are a meaningful 

method of encouraging efficiency. It is 

the Departments’ understanding that 

because conversion factors would be 

identical for every out-of-network 

service furnished by an anesthesiologist 

provider or provider group, use of the 

‘‘same conversion factor’’ for batching 

would result in the provider or provider 

group being able to batch every out-ofnetwork service it furnishes that 

otherwise satisfies the remaining 

batching factors. Instead, the 

Departments are of the view that 

batching based on CPT code categories 

would lead to greater efficiency, would 

more closely align with the statutory 

requirement that batched items and 

services relate to the treatment of a 

similar condition, and would lead to 

less variability among the items and 

services and factual circumstances that 

certified IDR entities must consider. 

The Departments request comment on 

the proposal that would govern whether 

anesthesiology qualified IDR items and 

services are considered to relate to the 

treatment of similar conditions. 

Specifically, the Departments solicit 

comment on whether and how items 

and services that share the same 

anesthesia conversion factor could be 

considered to relate to the treatment of 

similar conditions and could 

meaningfully encourage efficiency in 

the Federal IDR process. The 

Departments request comment on these 

proposals, including any data or other 

information that supports or contradicts 

the Departments’ understanding 

underlying this proposal. 

E. Batched Items and Services Must 

Have Been Furnished Within the Same 

Time Period 

Finally, the Departments propose at 

26 CFR 54.9816–8(c)(4)(i)(D), 29 CFR 

2590.716–8(c)(4)(i)(D), and 45 CFR 

149.510(c)(4)(i)(D) that batched 

qualified IDR items and services must 

have been furnished within the same 

30-business-day period following the 

date on which the first item or service 

included in the batched determination 

was furnished and have been the 

subjects of a 30-business-day open 

negotiation period that ended within 4 

business days of IDR initiation, except 

as provided in proposed 26 CFR 

54.9816–8(c)(5)(vii)(B), 29 CFR 

2590.716–8(c)(5)(vii)(B), and 45 CFR 

149.510(c)(5)(vii)(B), which refer to the 

90-calendar-day ‘‘cooling off’’ period. 

This is consistent with section 

9816(c)(3)(B) of the Code, section 

716(c)(3)(B) of ERISA, and section 

2799A–1(c)(3)(B) of the PHS Act and is 

in effect the same as the current 

regulations at 26 CFR 54.9816– 

8T(c)(3)(i)(D), 29 CFR 2590.716– 

8(c)(3)(i)(D), and 45 CFR 

149.510(c)(3)(i)(D). The Departments are 

also proposing a non-substantive 

amendment at 26 CFR 54.9816– 

8(c)(4)(i)(D), 29 CFR 2590.716– 

8(c)(4)(i)(D), and 45 CFR 

149.510(c)(4)(i)(D) to both remove the 

redundant language on the 90-calendarday ‘‘cooling off’’ period and correct the 

cross-reference to paragraph 26 CFR 

54.9816–8T(c)(5)(vii)(B), 29 CFR 

2590.716–8(c)(5)(vii)(B), and 45 CFR 

149.510(c)(5)(vii)(B). The Departments 

do not propose any alternative time 

periods for batched determinations, as 

the Departments are of the view that the 

batching rules proposed in these rules 

are sufficient to encourage procedural 

efficiency and minimize administrative 

costs for the disputing parties. 

The Departments solicit comment on 

the application of the cooling off period 

after a determination on a dispute 

consisting of multiple items and 

services batched by patient encounter or 

CPT code ranges. For example, if 

provider X submitted a notice of IDR 


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initiation that included as part of a 

batched determination a single view xray of the abdomen (CPT code 74018) to 

payer Y and the certified IDR entity 

made a determination on the dispute, 

should provider X be allowed to submit 

another dispute, such as a batched 

patient encounter dispute, within the 

90-day period following such 

determination that involves a single 

view x-ray of the abdomen (CPT code 

74018) to payer Y? It is the Departments’ 

understanding that under these 

proposed batching rules, the 90- 

calendar-day cooling off period could 

result in operational challenges and 

barriers both to disputing parties 

submitting subsequent IDR disputes and 

certified IDR entities’ review. In the 

example of provider X that submitted a 

batched dispute with an x-ray of the 

abdomen (CPT code 74018) to payer Y, 

and for which a certified IDR entity had 

made a determination, provider X under 

the proposed rules would have to 

ensure to not include an x-ray of the 

abdomen (CPT code 74018) in any 

subsequent notices of IDR initiation to 

payer Y within the 90-calendar-day 

period following such determination. 

Where subsequent disputes involve 

larger numbers of items or services, 

such as batched disputes based on 

patient encounters or CPT code ranges, 

this could result in additional time a 

party must spend excluding the specific 

item or service subject to the cooling off 

period from the batch and could also 

present additional burdens on certified 

IDR entities in assessing whether the 

cooling off period applies to one item or 

service within a batch and therefore 

whether the batched dispute is eligible 

for initiation of the Federal IDR process. 

In addition, the Departments have heard 

from some providers that since cooling 

off periods are allowed to overlap, and 

with each new written determination 

issued the current cooling off period is 

extended before it has ended, there are 

certain high-volume payers with which 

providers may be required to wait 

multiple years before the Federal IDR 

process could be initiated again. Batches 

for single patient encounters may 

exacerbate this situation. 

Under section 9816(c)(9) of the Code, 

section 716(c)(9) of ERISA, and section 

2799A–1(c)(9) of the PHS Act, the time 

periods required under the No Surprises 

Act and 26 CFR 54.9816–8T, 26 CFR 

54.9816–8, 29 CFR 2590.716–8, and 45 

CFR 149.510 (other than the timing of 

the payments to prevailing parties) may 

be modified at the Departments’ 

discretion to ensure that all claims that 

occur during a 90-day period following 

a payment determination for which a 

notification is not permitted to be 

submitted during such period by reason 

of the cooling-off-period requirements 

are eligible for the IDR process. If the 

proposed batching provisions are 

finalized, the Departments are 

considering using this statutory waiver 

authority under section 9816(c)(9) of the 

Code, section 716(c)(9) of ERISA, and 

section 2799A–1(c)(9) of the PHS Act, to 

shorten the 90-day cooling off time 

period with respect to qualified IDR 

items and services for which a certified 

IDR entity makes a payment 

determination as part of a batched 

dispute. This would increase the 

efficiency of processing subsequently 

submitted batched disputes and ensure 

that claims that occur during the cooling 

off period are eligible for the Federal 

IDR process. The Departments seek 

comment on this exception and 

alternative time periods the 

Departments should consider for the 

cooling off period in this circumstance. 

The Departments are considering 

shortening the cooling off period for 

batched disputes to between 1 to 30 

business days, if the batching proposals 

are finalized. As discussed in this 

section of the preamble, the 

Departments are of the view that the 

interaction of the 90-day cooling off 

period with the proposed batching 

provisions would reduce inefficiencies 

for the disputing parties, certified IDR 

entities, and the Federal IDR process. 

Further, as discussed in section II.E.2.c. 

of this preamble, section 9816(c)(3)(A) 

of the Code, section 716(c)(3)(A) of 

ERISA, and section 2799A–1(c)(3)(A) of 

the PHS Act directs the Departments to 

ensure that the Federal IDR process 

operates efficiently. Thus, the 

Departments are of the view that to 

encourage the efficiency of the Federal 

IDR process (including minimizing 

costs), the Departments should exercise 

their waiver authority to reduce the 

length of the cooling off period to be as 

short as 1 business day. Under these 

proposed rules, disputing parties would 

not be able to realize the efficiencies of 

batching by patient encounter if both 

parties may have to wait 90 business 

days before submitting a subsequent 

dispute. For example, it is the 

Departments understanding that it is 

highly likely that provider X could have 

multiple patient encounter batched 

disputes that involve payer Y where at 

least one common item or service would 

overlap in each of those disputes. The 

Departments are also aware of concerns 

that due to throughput issues, when 

payment determinations are made, and 

the inability to submit disputes either 

because they could not be submitted as 

batched disputes under the vacated 

batching rules or because the cooling off 

period applied, the Federal IDR process 

has not been economically feasible for 

all providers. The Departments are of 

the view that markedly reducing the 

cooling off period, in combination with 

the other proposed provisions in these 

rules, would help make the Federal IDR 

process both more economically feasible 

and efficient for disputing parties. The 

Departments have also heard from some 

payers that they are inundated with 

multiple open negotiation notices and 

disputes from certain providers making 

it difficult to meet the deadlines for 

each dispute. For this reason, the 

Departments are considering as much as 

30 business days for the duration of the 

cooling off period for batched disputes 

as it may help ensure parties are not 

inundated with disputes and provide 

parties sufficient time to meet the 

different time-period requirements of 

the Federal IDR process. The 

Departments solicit comment on this 

proposal, including specific alternative 

time periods the Departments should 

consider for the cooling off period. The 

Departments request any data or other 

information that supports or contradicts 

the Departments’ understanding. 

The Departments request comment on 

these proposals, including whether 

there are different or additional ways to 

encourage procedural efficiency and 

minimize administrative costs through 

the batching rules. 

ii. Treatment of Bundled Payment 

Arrangements 

The Departments propose at 26 CFR 

54.9816–8(c)(4)(ii), 29 CFR 2590.716– 

8(c)(4)(ii), and 45 CFR 149.510(c)(4)(ii) 

that qualified IDR items and services 

that meet the definition of a bundled 

payment arrangement at proposed 26 

CFR 54.9816–3, 29 CFR 2590.716–3, and 

45 CFR 149.30 may be submitted and 

considered as a single payment 

determination for which the certified 

IDR entity must make one payment 

determination for the multiple items 

and services included in the bundled 

payment arrangement. The Departments 

further propose that bundled payment 

arrangements submitted under 

paragraph (c)(4)(ii) would continue to be 

subject to the certified IDR entity fee for 

single determinations as described at 26 

CFR 54.9816–8T(e)(2)(vii), 29 CFR 

2590.716–8(e)(2)(vii), and 45 CFR 

149.510(e)(2)(vii). These proposed 

technical amendments to 26 CFR 

54.9816–8(c)(4)(ii), 29 CFR 2590.716– 

8(c)(4)(ii), and 45 CFR 149.510(c)(4)(ii) 

would include a reference to the 

definition of ‘‘bundled payment 


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167As discussed in section II.A. of the preamble, 

the Departments propose to amend 26 CFR 

54.9816–3, 29 CFR 2590.716–3, and 45 CFR 149.30 

to define the term ‘‘bundled payment arrangement.’’ 168 26 CFR 54.9816–8T(d)(2)(i), 29 CFR 2590.716– 

8(d)(2)(i), and 45 CFR 149.510(d)(2)(i). 169 26 CFR 54.9816–8T(d)(2)(ii), 29 CFR 

2590.716–8(d)(2)(ii), and 45 CFR 149.510(d)(2)(ii). 

170 88 FR 65888 (September 26, 2023). 

171 In TMA IV, the District Court issued an 

opinion and order holding that the process by 

which the Departments amended the December 

2022 fee guidance to increase the administrative fee 

for the Federal IDR process from $50 to $350 per 

party for disputes initiated during the calendar year 

beginning January 1, 2023, was a violation of the 

Departments’ obligation under the Administrative 

Procedure Act to give affected parties notice of and 

an opportunity to comment on the administrative 

fee. In light of the District Court’s opinion and 

order, as well as the Departments’ reassessment 

regarding the practicability of establishing the 

administrative fee through notice and comment 

rulemaking, the Departments proposed in the IDR 

Process Fees proposed rules to establish the amount 

of the administrative fee through notice and 

comment rulemaking. 

arrangement,’’ 167 a correction that the 

certified IDR entity must make one 

payment determination for the multiple 

qualified IDR items and services 

included in the bundled payment 

arrangement, removal of the language 

that bundled payment arrangements are 

subject to the rules for batched 

determinations, and an updated cross 

reference to paragraph (c)(4)(ii). 

3. Administrative and Certified IDR 

Entity Fee Collection 

The Departments propose to amend 

the administrative and certified IDR 

entity fee provisions of 26 CFR 54.9816– 

8(d), 29 CFR 2590.716–8(d), and 45 CFR 

149.510(d) to adjust the timing of 

collection of the administrative fee and 

make changes to the administrative fee 

structure to ensure that the financial 

costs to the Departments to administer 

the Federal IDR process align with the 

assessed administrative fees, to 

encourage disputing parties to engage in 

meaningful open negotiations, to 

accelerate dispute processing, and to 

reduce the burden on certified IDR 

entities. 

a. Establishment of the Administrative 

Fee Amount 

Under section 9816(c)(8)(A) of the 

Code, section 716(c)(8)(A) of ERISA, 

section 2799A–1(c)(8)(A) of the PHS 

Act, and the October 2021 interim final 

rules,168 each party to a determination 

must pay an administrative fee for 

participating in the Federal IDR process. 

Under section 9816(c)(8)(B) of the Code, 

section 716(c)(8)(B) of ERISA, section 

2799A–1(c)(8)(B) of the PHS Act, and 

the October 2021 interim final rules,169

the administrative fee is established 

annually in a manner so that the total 

administrative fees paid for a year are 

estimated to be equal to the amount of 

expenditures estimated to be made by 

the Departments to carry out the Federal 

IDR process for that year. 

On September 26, 2023, the 

Departments issued the IDR Process 

Fees proposed rules,170 proposing to 

amend the language at 26 CFR 54.9816– 

8(d)(2)(ii), 29 CFR 2590.716–8(d)(2)(ii), 

and 45 CFR 149.510(d)(2)(ii) to establish 

the Federal IDR process administrative 

fee amount through notice and comment 

rulemaking, rather than in guidance.171

In the IDR Process Fees proposed rules, 

the Departments proposed the 

methodology to calculate the 

administrative fee amount for disputes 

initiated on or after the later of the 

effective date of the IDR Process Fees 

proposed rules or on January 1, 2024, by 

projecting the amount of expenditures 

to be made by the Departments in 

carrying out the Federal IDR process 

and dividing this by the projected 

number of administrative fees to be paid 

by the parties. Using this methodology, 

the Departments proposed an 

administrative fee of $150 per party per 

dispute. Additionally, the Departments 

proposed that the administrative fee 

amount specified in rulemaking would 

remain in effect until a new 

administrative fee amount is specified 

in subsequent rulemaking. Furthermore, 

in the IDR Process Fees proposed rules, 

the Departments proposed to remove the 

requirement to set the administrative fee 

amount annually, allowing the 

Departments the flexibility to update the 

administrative fee amount more or less 

frequently than annually to increase the 

Departments’ ability to respond to 

changes in expenditures or collections 

that would require a new administrative 

fee amount. The comment deadline on 

the IDR Process Fees proposed rules is 

October 26, 2023. The Departments will 

review all public comments received on 

the IDR Process Fees proposed rules. 

The Departments note that a number 

of the proposed provisions in these 

proposed rules would impact the 

collection of administrative fees, 

including the time of collection of the 

administrative fee discussed in section 

II.E.3.b. of this preamble, the proposed 

reduced administrative fee for both 

parties in low-dollar disputes discussed 

in section II.E.3.e. of this preamble, and 

the proposed reduced administrative fee 

for non-initiating parties in ineligible 

disputes discussed in section II.E.3.f. of 

this preamble and would therefore 

impact the methodology that the 

Departments use to determine the 

administrative fee. Accordingly, in these 

proposed rules, the Departments 

propose to adjust the methodology for 

calculating the administrative fee 

amount that was proposed in the IDR 

Process Fees proposed rules. As 

discussed in greater detail below, while 

in the IDR Process Fees proposed rules 

the Departments proposed to calculate 

the projected number of administrative 

fees to be paid using the total volume of 

disputes to be closed, in these proposed 

rules, the Departments propose to 

instead use the total volume of disputes 

to be initiated, due to the proposal to 

collect the administrative fee earlier in 

the Federal IDR process, as discussed 

further in section II.E.3.b. of this 

preamble. 

In addition, the Departments are 

proposing other policies in these 

proposed rules that, if finalized, would 

impact the Departments’ expenditures 

in carrying out the Federal IDR process, 

including the proposed departmental 

eligibility review discussed in section 

II.E.1.b.ii. of this preamble, the direct 

collection of the administrative fee by 

the Departments discussed in section 

II.E.3.c. of this preamble, and the 

proposed Federal IDR process registry 

discussed in section II.F. of this 

preamble, which would impact the 

inputs under the methodology used to 

calculate the administrative fee amount. 

The Departments note that, using the 

base methodology as proposed in the 

IDR Process Fees proposed rules, and 

taking into account the additional 

proposed policies in these rules and 

their impact on the inputs under the 

administrative fee methodology 

proposed in the IDR Process Fees 

proposed rules, the administrative fee 

amount would continue to be $150 per 

party per dispute. 

In light of the proposals in these rules, 

the Departments project the annual 

expenditures to carry out the Federal 

IDR process, if the proposals in these 

rules are finalized, to be approximately 

$100.2 million. The proposed 

expenditures upon which the 

administrative fee amount in these rules 

is based include contract costs and 

Federal resources associated with: 

• Maintaining the Federal IDR portal, 

including the proposed Federal IDR 

process registry discussed in section 

II.F. of this preamble, which is intended 

to make the parties’ and certified IDR 

entities’ experiences using the portal 

more efficient, clear, and streamlined; 

• Certifying IDR entities and 

collecting data from them, which is 

intended to increase the number of 

certified IDR entities, improve the speed 

of eligibility and payment 

determinations, and assist the 

Departments in understanding where 

efficiencies may still be gained in the 

process; 


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172 88 FR 65888, 65893. 173The Departments applied the approximate 25 

percent reduction described in these rules to the 

average monthly volume and multiplied this 

number by 12 to project the annual volume of 

initiated disputes. 

• Conducting program integrity 

activities, such as QPA audits and IDR 

decision audits, which are intended to 

ensure the program integrity by 

reducing and preventing errors in the 

Federal IDR process; 

• Investigating relevant complaints, 

which is intended to ensure compliance 

with the Federal IDR process 

requirements; 

• Providing outreach to parties and 

technical assistance to certified IDR 

entities, which is intended to streamline 

the experience and further improve the 

speed and integrity of eligibility and 

payment determinations; 

• Collecting administrative fees 

directly from disputing parties, which is 

intended to reduce burden on certified 

IDR entities, increasing capacity of 

certified IDR entities to perform other 

required functions; 

• Conducting eligibility 

determinations when any of the 

extenuating circumstances described in 

proposed 26 CFR 54.9816–8(g), 29 CFR 

2590.716–8(g), and 45 CFR 149.510(g) 

require application of the departmental 

eligibility review to facilitate timely 

payment determinations or the effective 

processing of disputes under the Federal 

IDR process; and 

• Retaining and making available 

Federal personnel dedicated to carrying 

out Federal IDR process activities. 

Further, as described above, estimates 

for these expenditures assume that the 

Departments would determine that 

extenuating circumstances exist to 

invoke the departmental eligibility 

review, as discussed in sections 

II.E.1.b.ii. through iv. of this preamble 

and as proposed in 26 CFR 54.9816– 

8(c)(2)(ii), 29 CFR 2590.716–8(c)(2)(ii), 

and 45 CFR 149.510(c)(2)(ii). The 

Departments began conducting preeligibility reviews in 2023 to allow the 

certified IDR entities to complete their 

eligibility determinations more 

efficiently. As discussed in section 

II.E.1.b.ii. of this preamble, the 

departmental eligibility review 

proposed in these proposed rules 

contemplates a similar process except 

that the Departments would make 

eligibility determinations, rather than 

eligibility recommendations, to certified 

IDR entities. 

With respect to the Departments’ 

projected number of administrative fees 

to be paid, in the IDR Process Fees 

proposed rules, the Departments 

proposed to base this number on the 

total volume of disputes that were 

projected to be closed. However, in 

these proposed rules, the Departments 

propose to project the number of 

administrative fees to be paid based on 

the total volume of disputes projected to 

be initiated. In the IDR Process Fee 

proposed rules, the Departments 

proposed to use the total volume of 

disputes projected to be closed, rather 

than the total volume of disputes 

projected to be initiated, because the 

total volume of closed disputes would 

be more indicative of the total volume 

of disputes for which fees are paid 

under the Departments’ current 

collections process.172 In these 

proposed rules, the Departments 

propose to instead use the total volume 

of disputes projected to be initiated 

because the proposed operational 

changes in these proposed rules, if 

finalized, would result in the 

Departments’ collection of 

administrative fees closer to a dispute’s 

date of initiation, and therefore, the total 

volume of initiated disputes would be 

indicative of the total volume of 

disputes for which fees would be paid. 

Additionally, in projecting the 

administrative fees to be paid, the 

Departments consider that, if the 

proposed policies described in sections 

II.E.3.e. and II.E.3.f. of this preamble are 

finalized, the initiating and noninitiating parties in ineligible and lowdollar disputes may pay a reduced 

administrative fee, which would be 

percentages of the full administrative 

fee amount. To arrive at the proposed 

reduced administrative fee percentages, 

the Departments analyzed historical 

trends of low-dollar and ineligible 

disputes and include further discussion 

of the calculation of these percentages 

in sections II.E.3.e. and II.E.3.f. of this 

preamble. As with the full 

administrative fee amount, the 

Departments propose at 26 CFR 

54.9816–8(d)(2)(iii), 29 CFR 2590.716– 

8(d)(2)(iii), and 45 CFR 149.510(d)(2)(iii) 

that the reduced administrative fee 

amounts would remain in effect until 

changed by subsequent rulemaking. 

Accordingly, the total amount of 

projected administrative fees paid is 

calculated to reflect that the 

Departments would not collect a full 

administrative fee from both parties on 

a portion of disputes. 

To determine the administrative fees 

to be paid, the Departments project 

approximately 420,000 disputes will be 

initiated annually. This projection is 

based on the most recent 6-month 

period of continuous Federal IDR 

process data before Federal IDR process 

operations were temporarily paused on 

August 3, 2023.173 Using this projected 

volume of disputes, the Departments 

assume a prospective reduction of 

approximately 25 percent in the volume 

of initiated disputes because of the 

anticipated impact of the proposed 

batching policies in these proposed 

rules, if finalized. As previously 

explained, to calculate the number of 

administrative fees to be paid from the 

projected volume of disputes initiated, 

the Departments consider that noninitiating and initiating parties may pay 

a reduced administrative fee in lowdollar and ineligible disputes if the 

proposed policies described in sections 

II.E.3.e. and II.E.3.f. of this preamble are 

finalized. Additionally, the Departments 

consider the proposals in these rules 

pertaining to open negotiation, 

initiation, batching, registration, and the 

other administrative fee policies, if 

finalized, in calculating the number of 

disputes initiated and this 

administrative fee amount. 

Therefore, the Departments estimate 

that 420,000 initiated disputes, which 

include low-dollar and ineligible 

disputes with reduced administrative 

fees, would translate to an amount 

approximately equal to 691,000 full 

administrative fees paid. This estimate 

reflects that both parties to a dispute 

pay an administrative fee. Further, 

based on Federal IDR process data, the 

Departments estimate that 20 percent of 

initiated disputes would qualify as lowdollar disputes and 22 percent of 

initiated disputes would be ineligible. 

As described in Table 5, the 

Departments estimate that low-dollar 

and ineligible disputes will overlap 

such that some low-dollar disputes are 

determined to be ineligible. As 

explained further in sections II.E.3.e. 

and II.E.3.f. of this preamble, noninitiating parties would pay 20 percent 

of the full administrative fee in 

ineligible disputes and both initiating 

and non-initiating parties would pay 50 

percent of the full administrative fee in 

low-dollar disputes. 

Using the proposed methodology and 

inputs discussed above, the 

administrative fee for disputes initiated 

on or after January 1, 2025, and 

continuing until changed by subsequent 

rulemaking, would be calculated by 

dividing the projected annual 

expenditures of approximately $100.2 

million to be made by the Departments 

in carrying out the Federal IDR process 

by the projected annual number of 

administrative fees to be paid by the 

disputing parties of 691,000. This 

results in a full administrative fee 

amount of $150 per party per dispute, 

which is the same amount as the 

Departments proposed in the IDR 

Process Fees proposed rules. However, 


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75794 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

as described in this preamble section, 

the methodology and inputs for 

calculating the administrative fee in 

these proposed rules differ from those in 

the IDR Process Fees proposed rules. In 

the IDR Process Fees proposed rules, the 

Departments calculated the proposed 

administrative fee by dividing projected 

annual expenditures of $70 million by 

approximately 450,000 full 

administrative fees paid on 225,000 

closed disputes. 

As discussed further in sections 

II.E.3.e. and II.E.3.f. of these rules, the 

reduced administrative fee for both 

parties in low-dollar disputes would be 

50 percent of the full administrative fee 

(or $75) per party per dispute, and the 

reduced administrative fee for noninitiating parties in ineligible disputes 

would be 20 percent of the full 

administrative fee (or $30) per party per 

dispute. These fee estimates, as set forth 

in Table 5, are based on the best 

available data, the Departments’ 

projected expenditures as of the 

publication of these proposed rules, and 

the assumptions that the administrative 

fee of $150 per party per dispute in the 

IDR Process Fees proposed rules is 

finalized and applicable starting January 

1, 2024. These projections may change 

between the publication of the proposed 

and final rules based on more recent 

data available at that time; thus, the 

Departments propose to finalize an 

administrative fee amount that follows 

the methodology proposed here, as 

finalized, using the updated data, if 

applicable. In the event one or more of 

the policies proposed in these rules are 

not finalized or the departmental 

eligibility review is not anticipated to be 

invoked, the Departments would 

recalculate the proposed administrative 

fee amount to reflect relevant changes to 

the proposed policies when finalizing 

the administrative fee amount. 

BILLING CODE 6325–63–P; 4830–01–P; 4510–29–P; 

4120–01–P 


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BILLING CODE 6325–63–C; 4830–01–C; 4510–29–C; 

4120–01–C The Departments solicit comments on 

the methodology for calculating the 

administrative fee, additional inputs 

used to calculate the administrative fee 


lotter on DSK11XQN23PROD with PROPOSALS2EP03NO23.008</GPH>

TABLE 5: Proposed Administrative Fee Amounts for Disputes Initiated On or 

After January 1, 2025 

Type of Dispute Proposed Fee Charged per Party per 

Dispute 

Standard Dispute, Eligible for Federal IDR Process Initiating Party 100 percent of the administrative 

fee; anticipated to be $150 

Initiating party does not attest that the highest offer (or 

aggregate offers for the dispute, whether the dispute is 

for one item or service, a bundled arrangement, or 

multiple items and services submitted as part of a 

batched dispute) made during open negotiation for such Non-initiating 100 percent of the administrative 

dispute by either party was less than the amount of the Party fee; anticipated to be $150 

standard administrative fee and the dispute is 

determined eligible for the Federal /DR process 

Standard Dispute, Ineligible for Federal IDR Process Initiating Party 100 percent of the administrative 

fee; anticipated to be $150 

Initiating party does not attest that the highest offer (or 

aggregate offers for the dispute, whether the dispute is 

for one item or service, a bundled arrangement, or 

multiple items and services submitted as part of a 

batched dispute) made during open negotiation for such Non-initiating 20 percent of the administrative 

dispute by either party was less than the amount of the Party fee; anticipated to be $30 

standard administrative fee and the dispute is 

determined ineligible for the Federal /DR process 

Low-Dollar Dispute, Eligible for Federal IDR Initiating Party 50 percent of the administrative 

Process fee; anticipated to be $75 

Initiating party attests that the highest offer (or 

aggregate offers for the dispute, whether the dispute is 

for one item or service, a bundled arrangement, or 

multiple items and services submitted as part of a Non-initiating 50 percent of the administrative 

batched dispute) made during open negotiation for such Party fee; anticipated to be $75 

dispute by either party was less than the amount of the 

standard administrative fee and the dispute is 

determined eligible for the Federal /DR process 

Low-Dollar Dispute, Ineligible for Federal IDR Initiating Party 50 percent of the administrative 

Process fee; anticipated to be $75 

Initiating party attests that the highest offer (or 

aggregate offers for the dispute, whether the dispute is 

for one item or service, a bundled arrangement, or 

multiple items and services submitted as part of a Non-initiating 20 percent of the administrative 

batched dispute) made during open negotiation for such Party fee; anticipated to be $30 

dispute by either party was less than the amount of the 

standard administrative fee and the dispute is 

determined ineligible for the Federal /DR process 
75796 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

174Centers for Medicare & Medicaid Services 

(Mar. 2023). Federal Independent Dispute 

Resolution (IDR) Process Guidance for Certified IDR 

Entities. https://www.cms.gov/files/document/ 

federal-idr-guidance-idr-entities-march-2023.pdf. 

175Section 9816(c)(5)(F)(i) of the Code, section 

716(c)(5)(F)(i) of ERISA, and section 2799A– 

1(c)(5)(F)(i) of the PHS Act. 

and proposed administrative fee 

amounts, including the reduced 

administrative fee amounts, as well as 

the proposed implementation date of 

the proposed administrative fee. 

b. Time of Collection of Certified IDR 

Entity Fee and Administrative Fee 

i. Time of Collection of Certified IDR 

Entity Fee 

The Departments propose to amend 

26 CFR 54.9816–8(d)(1)(i), 29 CFR 

2590.716–8(d)(1)(i), and 45 CFR 

149.510(d)(1)(i) to reflect that each party 

to a dispute that either the certified IDR 

entity or the Departments determine is 

eligible for the Federal IDR process must 

pay to the certified IDR entity the 

predetermined certified IDR entity fee 

no later than the time the parties submit 

their offers, as described in proposed 26 

CFR 54.9816–8(c)(5)(i), 29 CFR 

2590.716–8(c)(5)(i), and 45 CFR 

149.510(c)(5)(i). 

The Departments also propose to 

codify in 26 CFR 54.9816–8(d)(1)(iii), 29 

CFR 2590.716–8(d)(1)(iii), and 45 CFR 

149.510(d)(1)(iii) the current practice 

established in section 10.2 of the 

Federal IDR Process Guidance for 

Certified IDR Entities 174 that the 

certified IDR entity must retain the 

certified IDR entity fee described in 26 

CFR 54.9816–8(d)(1)(i), 29 CFR 

2590.716–8(d)(1)(i), and 45 CFR 

149.510(d)(1)(i) paid by the party whose 

offer was not selected (the nonprevailing party, as defined in proposed 

26 CFR 54.9816–8(c)(5)(ii)(A)(2), 29 CFR 

2590.716–8(c)(5)(ii)(A)(2), and 45 CFR 

149.510(c)(5)(ii)(A)(2)), consistent with 

the No Surprises Act.175 The 

Departments further propose to move 

the existing requirement in current 

paragraph 26 CFR 54.9816–8T(d)(1)(ii), 

29 CFR 2590.716–8(d)(1)(ii), and 45 CFR 

149.510(d)(1)(ii), which requires the 

certified IDR entity to return the fee 

paid by the prevailing party within 30 

business days following the date of the 

certified IDR entity’s payment 

determination, to 26 CFR 54.9816– 

8(d)(1)(iii), 29 CFR 2590.716–8(d)(1)(iii), 

and 45 CFR 149.510(d)(1)(iii). Further, 

the Departments propose that in the 

event of a batched dispute in which 

each party prevails in an equal number 

of determinations, the certified IDR 

entity fee would be split evenly between 

the parties. In that case, the certified 

IDR entity would be required to return 

half of the fee paid by each party within 

30 business days following the date of 

the certified IDR entity’s payment 

determination. 

Additionally, the Departments 

propose to add 26 CFR 54.9816– 

8(d)(1)(iv), 29 CFR 2590.716–8(d)(1)(iv), 

and 45 CFR 149.510(d)(1)(iv) to provide 

that when the parties reach an 

agreement on an out-of-network rate for 

qualified IDR items or services, as 

described in proposed 26 CFR 54.9816– 

8(c)(3)(i), 29 CFR 2590.716–8(c)(3)(i), 

and 45 CFR 149.510(c)(3)(i), or agree to 

withdraw a dispute under the 

circumstances set forth at proposed 26 

CFR 54.9816–8(c)(3)(ii), 29 CFR 

2590.716–8(c)(3)(ii), and 45 CFR 

149.510(c)(3)(ii), for a dispute that has 

already been assigned to a certified IDR 

entity and determined eligible for the 

Federal IDR process but for which the 

certified IDR entity has not made a 

payment determination, the certified 

IDR entity must return half of each 

party’s certified IDR entity fee within 30 

business days of the agreement or 

withdrawal, unless directed otherwise 

by both parties. This proposed new 

paragraph would relocate the similar 

requirement when parties reach an 

agreement, currently captured in 26 CFR 

54.9816–8T(c)(2)(ii) and (e)(2)(viii), 29 

CFR 2590.716–8(c)(2)(ii) and (e)(2)(viii), 

and 45 CFR 149.510(c)(2)(ii) and 

(e)(2)(viii), which require the certified 

IDR entity to return half of each party’s 

certified IDR entity fee within 30 

business days of an agreement, and 

codifies the Departments’ interpretation 

that a withdrawal of a dispute should be 

treated similarly to a settlement. Similar 

to when parties settle prior to an 

eligibility determination and therefore 

do not need to pay the certified IDR 

entity fee because the certified IDR 

entity did not make an eligibility and/ 

or payment determination, when a 

dispute is withdrawn prior to an 

eligibility determination, the 

Departments are of the view that the 

parties similarly should not be required 

to pay the fee because the certified IDR 

entity again did not make an eligibility 

and/or payment determination. 

Accordingly, because the certified IDR 

entity fee is only assessed for disputes 

that are determined eligible for the 

Federal IDR process, the Departments 

clarify that the certified IDR entity fee 

would not be assessed for a dispute that 

is withdrawn or settled before the 

Departments or the certified IDR entity, 

as applicable, make a determination on 

the eligibility of the dispute for the 

Federal IDR process. However, because 

the obligation to pay the certified IDR 

entity fee applies to all eligible disputes, 

both parties would still be required to 

pay the certified IDR entity fee if the 

dispute is withdrawn or settled after the 

dispute is determined eligible but before 

the certified IDR entity makes a 

payment determination. 

Finally, the Departments propose to 

add 26 CFR 54.9816–8(d)(1)(v), 29 CFR 

2590.716–8(d)(1)(v), and 45 CFR 

149.510(d)(1)(v) to provide that when 

the parties reach an agreement on an 

out-of-network rate or agree to withdraw 

the dispute for which there is a final 

selection of the certified IDR entity but 

that has not yet had a final eligibility 

determination, unless directed 

otherwise by both parties, the certified 

IDR entity would be required to return 

each party’s full certified IDR entity fee 

within 30 business days of the date both 

parties notify the certified IDR entity 

that they have agreed on an out-ofnetwork rate or agreed to withdraw the 

dispute. The purpose of this proposal is 

to codify the responsibilities of the 

parties and certified IDR entities when 

the parties agree to settle or withdraw 

the dispute, but the dispute has not yet 

been determined eligible for the Federal 

IDR process. Similar to the proposal 

regarding settlements and withdrawals 

for eligible disputes, because the 

certified IDR entity fee is only assessed 

for disputes that are determined eligible 

for the Federal IDR process, the certified 

IDR entity fee would not be assessed for 

a dispute that is withdrawn or settled 

before the Departments or the certified 

IDR entity, as applicable, determine the 

eligibility of the dispute for the Federal 

IDR process. 

The Departments seek comment on 

these proposals including the treatment 

of a withdrawal of a dispute similar to 

a settlement. 

ii. Time of Collection of Administrative 

Fee 

The Departments are also proposing 

multiple changes to the timing of the 

collection of the administrative fee in 

proposed 26 CFR 54.9816–8(d)(2)(i)(A), 

29 CFR 2590.716–8(d)(2)(i)(A), and 45 

CFR 149.510(d)(2)(i)(A). The 

Departments propose to require the 

initiating party to pay the administrative 

fee within 2 business days of the date 

of preliminary selection of the certified 

IDR entity pursuant to proposed 26 CFR 

54.9816–8(c)(1)(iii), 29 CFR 2590.716– 

8(c)(1)(iii), and 45 CFR 

149.510(c)(1)(iii). The Departments 

further propose that the non-initiating 

party must pay the administrative fee 

within 2 business days of the date of 

notice that an eligibility determination 

for the Federal IDR process has been 

reached by either the certified IDR 

entity or the Departments, if the 


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176See U.S. Department of Health and Human 

Services, U.S. Department of Labor, and U.S. 

Department of the Treasury. (Oct. 2022). Federal 

Independent Dispute Resolution (IDR) Process 

Guidance for Certified IDR Entities. https://

www.cms.gov/files/document/federal-independentdispute-resolution-guidance-disputing-parties.pdf. 177 86 FR 56001. 

departmental eligibility review applies 

as proposed in 26 CFR 54.9816– 

8(c)(2)(ii), 29 CFR 2590.716–8(c)(2)(ii), 

and 45 CFR 149.510(c)(2)(ii). 

As discussed in section II.E.3.f. of this 

preamble, the Departments propose that 

the non-initiating party would pay a 

reduced administrative fee for disputes 

that are determined ineligible for the 

Federal IDR process; therefore, 

eligibility would need to be determined 

before the non-initiating party is 

charged the administrative fee. The 

Departments are of the view that 2 

business days to pay the administrative 

fee would be an appropriate amount of 

time from the date of preliminary 

selection of the certified IDR entity (for 

initiating parties) and from the date of 

notice of an eligibility determination 

(for non-initiating parties), because it 

balances the need for the parties to have 

adequate notice of the fee being due and 

adequate time to pay the fee with the 

need to continue to move the Federal 

IDR process forward and provide parties 

with timelier payment determinations. 

Although the Departments considered 

requiring both parties to pay the 

administrative fee within the same 2- 

business-day period, failure of the 

initiating party to pay the administrative 

fee would result in dispute dismissal as 

discussed in section II.E.3.d. of this 

preamble, and neither party would owe 

the administrative fee for such a 

dispute. Additionally, the Departments 

are of the view that it is appropriate to 

align the non-initiating party’s deadline 

to pay the administrative fee with the 

date of the eligibility determination 

because, as proposed in these rules and 

described in section II.E.3.f. of this 

preamble, the non-initiating party’s 

administrative fee amount would be 

determined based on the eligibility of 

the dispute. 

The Departments are of the view that 

this timing would better ensure that the 

financial costs to the Departments to 

administer the Federal IDR process align 

with the assessed administrative fees. 

Specifically, as explained in section 

II.E.3.f. of this preamble, the 

Departments are of the view that 

requiring non-initiating parties to pay a 

reduced administrative fee if the dispute 

is ineligible would be appropriate 

because it would take into account the 

benefits that non-initiating parties 

receive from having access to the 

Federal IDR process. Currently, for 

administrative efficiency, the 

Departments’ guidance allows certified 

IDR entities the discretion to delay 

collection of the administrative fee until 

a party submits its offer,176 which is the 

same time that each party is required to 

pay the certified IDR entity fee 

described in 26 CFR 54.9816–8T(d)(1), 

29 CFR 2590.716–8(d)(1), and 45 CFR 

149.510(d)(1). Amending the timing for 

administrative fee collection would 

accelerate dispute processing and 

ensure that the costs of using the 

Federal IDR process are being allocated 

to all parties accessing the process, 

regardless of whether their disputes are 

eligible or ineligible. 

Furthermore, the Departments 

propose at 26 CFR 54.9816–8(d)(2)(i)(B), 

29 CFR 2590.716–8(d)(2)(i)(B), and 45 

CFR 149.510(d)(2)(i)(B) that when the 

parties reach an agreement on an out-ofnetwork rate for qualified IDR items or 

services or agree to withdraw the 

dispute after the dispute is initiated, the 

administrative fee would not be 

returned to the parties if preliminary 

selection of the certified IDR entity has 

occurred, as described in 26 CFR 

54.9816–8(c)(1)(i), 29 CFR 2590.716– 

8(c)(1)(i), and 45 CFR 149.510(c)(1)(i). 

This new paragraph would relocate the 

similar requirement when parties reach 

an agreement, currently captured in 26 

CFR 54.9816–8T(c)(2)(ii), 29 CFR 

2590.716–8(c)(2)(ii), and 45 CFR 

149.510(c)(2)(ii), which provides that 

the administrative fee will not be 

returned to the parties in the event of an 

agreement, and extends those 

requirements in the event of a dispute 

withdrawal. The Departments are of the 

view that these proposed policies would 

help ensure that disputing parties are 

appropriately incentivized to settle 

disputes through open negotiation 

before initiating the Federal IDR 

process. The Departments expect that 

submission of ineligible disputes would 

decrease because of this financial 

incentive combined with the proposed 

changes to open negotiation, discussed 

in section II.D. of this preamble, 

requiring the initiating party to attest 

that the item or service under dispute is 

a qualified IDR item or service and to 

identify the basis for the attestation, 

which would necessitate the initiating 

party actively evaluating eligibility 

before initiating the Federal IDR 

process. 

The Departments also propose in this 

paragraph that the administrative fee 

would still be required to be paid if the 

parties have not yet paid it at the time 

of settlement or withdrawal, unless the 

dispute is closed for nonpayment of the 

administrative fee by the initiating party 

2 business days after preliminary 

selection of the certified IDR entity. This 

proposal aligns with the current 

regulation at 26 CFR 54.9816– 

8T(d)(2)(i), 29 CFR 2590.716–8(d)(2)(i), 

and 45 CFR 149.510(d)(2)(i) providing 

that the administrative fee is nonrefundable, as discussed in the October 

2021 interim final rules.177 As stated in 

the October 2021 interim final rules, the 

Departments will have incurred 

expenditures to administer the Federal 

IDR process even in instances in which 

the parties reach an agreement before 

the certified IDR entity makes a 

payment determination. Thus, the 

Departments are proposing to codify the 

requirement that parties must pay the 

administrative fee for these disputes. 

Requiring the initiating party to pay 

the administrative fee within 2 business 

days of the date the certified IDR entity 

is preliminarily selected, which would 

occur before a dispute’s eligibility 

determination is made, would provide 

an incentive to initiating parties to 

reduce the number of ineligible disputes 

submitted and ensure that the financial 

burden for administering the Federal 

IDR process is shared across the parties 

accessing the process. Consequently, the 

Departments anticipate that fewer 

ineligible disputes would be submitted, 

and all disputes in which a certified IDR 

entity is preliminarily selected would 

contribute to the funds available to 

administer the Federal IDR process, 

regardless of eligibility. The 

Departments are of the view that this 

would improve overall efficiency in the 

Federal IDR process and potentially 

enable the Departments to lower the 

administrative fee at a future date in 

notice and comment rulemaking, as the 

costs of carrying out the Federal IDR 

process would be more equally 

allocated across a larger proportion of 

submitted disputes. 

The Departments seek comment on 

these proposals. 

c. Manner of Administrative Fee 

Collection 

The Departments propose to amend 

26 CFR 54.9816–8(d)(2)(i), 29 CFR 

2590.716–8(d)(2)(i), and 45 CFR 

149.510(d)(2)(i) to require each party 

participating in the Federal IDR process 

to pay the administrative fee directly to 

the Departments, instead of to the 

certified IDR entity for remittance to the 

Departments, as is currently required. 

The purpose of this proposal would be 

to improve dispute processing times and 

reduce certified IDR entities’ 


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178 86 FR 56001. 

179 Id. 

180See 26 CFR 54.9816–8T(d)(2)(i), 29 CFR 

2590.716–8(d)(2)(i), and 45 CFR 149.510(d)(2)(i). 

181See id. 

182HHS intends to propose in notice and 

comment rulemaking in the near future to amend 

45 CFR 156.1215 to provide that administrative fees 

for utilizing the No Surprises Act Federal IDR 

process for health insurance issuers that participate 

in financial programs under the ACA would be 

subject to netting as part of HHS’ integrated 

monthly payment and collections cycle. The netting 

proposals at 45 CFR 156.1215 would only apply to 

those issuers and their affiliates operating under the 

same TIN that participate in the financial programs 

under the ACA. 

administrative burden. To support the 

transition to this proposed approach of 

directly collecting the administrative fee 

and to improve the operation of current 

processes, the Departments also propose 

to make conforming amendments to 26 

CFR 54.9816–8(e)(2)(vi) and (ix), 29 CFR 

2590.716–8(e)(2)(vi) and (ix), and 45 

CFR 149.510(e)(2)(vi) and (ix) to reflect 

that certified IDR entities must maintain 

appropriate safeguards, controls, and 

procedures for any administrative fees 

they may be in possession of before the 

effective date of the proposed change to 

the manner of administrative fee 

collection, if finalized. 

The October 2021 interim final rules 

established that each disputing party’s 

administrative fee was due upon 

selection of the certified IDR entity and 

payable to the certified IDR entity.178

The Departments explained that 

allowing the certified IDR entity to 

collect the administrative fee on behalf 

of the Departments could increase 

efficiency, streamline the Federal IDR 

process, and allow for more convenient 

payment for the disputing parties and 

the Departments.179 However, there are 

many disputes in the Federal IDR 

process for which no fee has been 

collected for the work associated with 

processing the dispute, and the 

Departments are now of the view that 

collection of the administrative fee by 

the Departments directly rather than the 

certified IDR entities would be more 

efficient. The Departments are also of 

the view that, in light of the proposal to 

collect the administrative fee earlier in 

the process as proposed in these rules, 

collection of the administrative fee by 

the Departments would significantly 

reduce the burden on certified IDR 

entities because they would not have to 

collect fees at two different points in 

time, track collection of both fees, and 

then remit payment of the 

administrative fee to the Departments, 

as would be required if the proposal to 

change the administrative fee timing 

was finalized but the manner of 

collection was unchanged. Additionally, 

enabling the Departments to directly 

collect the administrative fee from the 

disputing parties may improve 

collection of the fee, in part through 

Federal debt collection mechanisms as 

outlined in section II.E.3.d. of this 

preamble. Finally, since these proposed 

rules would require parties to submit 

open negotiation notices, open 

negotiation notice responses, notices of 

initiation, and notice of initiation 

responses through the Federal IDR 

portal, as discussed in section II.D. of 

this preamble, the Departments would 

be in the best position to determine the 

appropriate time to bill and collect the 

administrative fee from the parties given 

the Departments’ access to this 

information. 

The Departments seek comment on 

this proposal. Additionally, the 

Departments seek comment on 

restricting the manner of payment of 

administrative and certified IDR entity 

fees to only electronic payments, 

including electronic funds transferred 

from a bank account, rather than 

allowing payment by check. 

d. Application of Federal IDR Process 

Requirements in Circumstances 

Involving a Failure To Pay Certified IDR 

Entity Fees or Administrative Fees 

To further streamline dispute 

processing, these proposed rules outline 

certain consequences that would apply 

for failure to timely pay the certified 

IDR entity fee, the administrative fee, or 

both fees. Specifically, the Departments 

propose in paragraph 26 CFR 54.9816– 

8(d)(1)(ii), 29 CFR 2590.716–8(d)(1)(ii), 

and 45 CFR 149.510(d)(1)(ii) that if 

either party fails to pay the certified IDR 

entity fee by the time the offer is due, 

that party’s offer would not be 

considered received. The Departments 

also propose that if a party fails to 

submit an offer or a party’s offer is not 

considered received due to nonpayment 

of the certified IDR entity fee, the nonprevailing party would continue to be 

responsible for payment of the certified 

IDR entity fee. This means that a 

certified IDR entity would be able to 

take all steps consistent with applicable 

law to collect any certified IDR entity 

fee owed to it. 

The Departments do not propose to 

change the requirement that each party 

to a dispute for which a certified IDR 

entity is selected must pay a nonrefundable administrative fee to 

participate in the Federal IDR 

process.180 Further, the Departments do 

not propose to change the requirement 

that the party whose offer is not selected 

by the certified IDR entity is ultimately 

responsible for payment of the certified 

IDR entity fee.181

Additionally, the Departments 

propose to add new proposed paragraph 

26 CFR 54.9816–8(d)(2)(i)(C), 29 CFR 

2590.716–8(d)(2)(i)(C), and 45 CFR 

149.510(d)(2)(i)(C) setting forth that if 

the initiating party fails to pay the 

administrative fee within 2 business 

days of the date of preliminary selection 

of the certified IDR entity under 

paragraph (c)(1)(iii), the dispute would 

be closed due to nonpayment and 

neither party would be responsible for 

the administrative fee. If a dispute is 

closed for nonpayment of the 

administrative fee by the initiating 

party, the Departments would not 

impose an obligation to pay the 

administrative fee on either party, since 

the dispute was terminated before 

substantial work was undertaken to 

process it. The Departments also 

propose in new paragraph (d)(2)(i)(C) 

that if the non-initiating party fails to 

pay the administrative fee within 2 

business days of an eligibility 

determination, that party’s offer would 

not be considered received. Even if the 

non-initiating party fails to submit an 

offer or the non-initiating party’s offer is 

not considered received due to 

nonpayment of the administrative fee in 

accordance with paragraph (d)(2)(i)(A), 

the non-initiating party would continue 

to be responsible for payment of the 

administrative fee. In addition, if the 

dispute is determined to be ineligible 

for the Federal IDR process, the noninitiating party would continue to be 

responsible for payment of the reduced 

administrative fees discussed in section 

II.E.3. of this preamble. 

Further, the Departments propose to 

provide in 26 CFR 54.9816–8(d)(2)(i)(D), 

29 CFR 2590.716–8(d)(2)(i)(D), and 45 

CFR 149.510(d)(2)(i)(D) that any party 

that fails to timely pay the 

administrative fee owed in accordance 

with paragraph (d)(2)(i)(A) of this 

section is still obligated to pay the 

administrative fee otherwise due and 

owing, and that failure to pay the 

administrative fee would result in a debt 

owed to the Federal Government, after 

netting any amounts owed by the 

Federal Government in accordance with 

45 CFR 156.1215, as applicable.182 The 

debt would then be collected pursuant 

to applicable debt collection authorities, 

including those that prescribe 

government-wide standards for 

administrative collection, compromise, 

disclosure of debt information to credit 

reporting agencies, referral of claims to 

private collection contractors for 

resolution, and referral to the 

Department of Justice for litigation. 


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Additionally, the Departments 

propose that the party to the dispute 

that incurs the debt would be 

determined by the TIN or NPI associated 

with the plan, issuer, provider, facility, 

or provider of air ambulance services 

that is a party to the dispute, which may 

not be the entity that filed the dispute. 

This means that when a plan that is a 

party to a dispute utilizes a TPA or 

other representative, it is the plan that 

would incur the administrative fee debt, 

not the TPA or representative. Similarly, 

if a provider or facility engages a 

revenue cycle management company or 

other representative, the provider or 

facility would be responsible for the 

administrative fee debt, not the revenue 

cycle management company or other 

representative. A TPA, revenue cycle 

management company, or other 

representative would still be allowed to 

manage or initiate the Federal IDR 

process on behalf of a disputing party, 

including remitting the administrative 

fee amount on behalf of the party to the 

dispute. 

The Departments are of the view that 

codifying the consequences of failure to 

pay the certified IDR entity fees and 

administrative fees would increase 

transparency and reduce the incidence 

of nonpayment. The Departments seek 

comment on these proposals. 

e. Administrative Fee Structure for 

Disputing Parties in Low-Dollar 

Disputes 

The Departments are proposing a 

framework to reduce the administrative 

fee for parties in low-dollar disputes to 

promote equitable access across the 

spectrum of parties seeking to initiate 

the Federal IDR process, such as 

providers in rural communities, small 

practices, specialties that regularly bill 

for services that have low-dollar costs, 

and issuers with a smaller pool of 

claims to absorb the impact of a 

standard administrative fee assessed for 

low-dollar disputes. 

The Departments propose to add 26 

CFR 54.9816–8(d)(2)(iii)(A) through (C), 

29 CFR 2590.716–8(d)(2)(iii)(A) through 

(C), and 45 CFR 149.510(d)(2)(iii)(A) 

through (C) to establish a framework for 

reducing the administrative fee in 

certain situations. The Departments 

propose in 26 CFR 54.9816– 

8(d)(2)(iii)(A), 29 CFR 2590.716– 

8(d)(2)(iii)(A), and 45 CFR 

149.510(d)(2)(iii)(A) to charge both 

parties a reduced administrative fee 

when the initiating party attests that the 

highest offer made during open 

negotiation by either party was less than 

the predetermined threshold proposed 

in these rules. The Departments propose 

that in order for both parties to be 

charged a reduced administrative fee for 

a dispute, the highest offer (or aggregate 

offers for a dispute, whether the dispute 

is for one item or service, a bundled 

payment arrangement, or multiple items 

and services submitted as part of a 

batched dispute) made during open 

negotiation for such dispute by either 

party must be less than the amount of 

the full administrative fee. As such, the 

Departments propose that the threshold 

that would apply for disputes initiated 

on or after January 1, 2025 would equal 

the amount of the standard 

administrative fee as proposed in 

section II.E.3.a. of this preamble, which 

is proposed to be $150 for disputes 

initiated on or after January 1, 2025. 

Further, the Departments propose in 

26 CFR 54.9816–8(d)(2)(iii)(A), 29 CFR 

2590.716–8(d)(2)(iii)(A), and 45 CFR 

149.510(d)(2)(iii)(A) that the reduced 

administrative fee amount for these lowdollar disputes would be 50 percent of 

the administrative fee amount, equating 

to $75 per party per dispute for disputes 

initiated on or after January 1, 2025, if 

the proposed administrative fee amount 

of $150 per party per dispute is 

finalized. To determine the amount of 

the reduced administrative fee, the 

Departments evaluated various factors 

pertaining to low-dollar disputes. This 

discussion appears in section II.E.3.f. of 

this preamble. 

As discussed in section II.E.2. of this 

preamble, interested parties have 

expressed concerns that disputes over 

relatively low-dollar claims, such as 

radiology claims, are being priced out of 

the Federal IDR process due to 

difficulties with batching items and 

services of sufficient value to make the 

Federal IDR process feasible. While the 

Departments anticipate that the new 

batching provisions proposed in these 

rules and discussed in section II.E.2. of 

this preamble would make the Federal 

IDR process more accessible to many 

parties, the Departments also want to 

consider other mechanisms to ensure 

that the Federal IDR process is 

financially accessible to a greater 

number of parties, including parties 

from rural communities, smaller 

organizations, and parties disputing 

services related to specialties that bill 

for low-dollar services. These parties 

may have more claims for low-dollar 

services than other types of parties due 

to the nature of their practice, which 

may result in fewer disputes that meet 

the batching requirements, making 

batching claims impractical for such 

parties. Even though the Departments 

recognize that disputes vary in 

complexity, resolving a dispute 

generally costs the Departments the 

same amount regardless of whether the 

dispute involves low-dollar or highdollar items or services. Accordingly, 

the Departments are proposing this 

administrative fee structure to further 

the goal of financial accessibility while 

ensuring that the Departments can 

collect sufficient funds to cover the 

costs of carrying out the Federal IDR 

process. If either or both parties to the 

dispute attest to satisfying the 

requirements for a reduced 

administrative fee but the Departments 

determine that either or both parties did 

not act in good faith in their 

submissions or responses, the 

Departments may decline to charge a 

reduced administrative fee. The 

Departments solicit comments on 

situations in which it would be 

appropriate for the Departments to 

decline to charge a party the reduced 

administrative fee, such as if the 

initiating party incorrectly attests that 

no offer submitted during open 

negotiation exceeded the threshold, and 

the Departments also solicit comments 

on additional approaches the 

Departments should consider to mitigate 

potential abuse of the proposed reduced 

administrative fee structure. 

Under these proposed rules, a party 

initiating a dispute in the Federal IDR 

portal using the notice of IDR initiation 

form discussed in section II.D.2.a. of 

this preamble would be required to 

attest in the Federal IDR portal that the 

highest offer (including the cumulative 

total of all line items for batched 

disputes) made during open negotiation 

by either party was less than the 

predetermined threshold, which the 

Departments propose would equal the 

amount of the full administrative fee 

($150 per party for disputes initiated on 

or after January 1, 2025, as discussed in 

section II.E.3.a. of this preamble). If the 

initiating party attests that the highest 

offer made during open negotiation by 

either party was less than the threshold, 

the administrative fee amount charged 

to both parties may be the reduced 

administrative fee for low-dollar 

disputes of 50 percent of the 

administrative fee. If the initiating party 

does not attest that the highest offer (or 

aggregate offers for a dispute, whether 

the dispute is for one item or service, a 

bundled payment arrangement, or 

multiple items and services submitted 

as part of a batched dispute) made 

during open negotiation by either party 

was less than the threshold, both parties 

may be charged the full amount of the 

proposed administrative fee. 

The Departments seek comment on 

the proposed administrative fee 

structure for low-dollar disputes, 

including any guardrails that may be 

necessary to prevent potential abuse. 


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183See U.S. Department of Health and Human 

Services, U.S. Department of Labor, and U.S. 

Department of the Treasury, Initial Report on the 

Federal Independent Dispute Resolution (IDR) 

Process, April 15–September 30, 2022. https://

www.cms.gov/files/document/initial-report-idrapril-15-september-30-2022.pdf. 

184See section 9816(c)(8)(A) of the Code, section 

716(c)(8)(A) of ERISA, and section 2799A–1(c)(8)(A) 

of the PHS Act. 

Specifically, the Departments seek 

comment on capping the offers of 

parties to a low-dollar dispute when the 

reduced administrative fee for lowdollar disputes applies, such that these 

parties would be prevented from 

submitting an offer above the low-dollar 

dispute threshold amount to ensure that 

parties requesting to pay the reduced 

administrative fee actually have 

disputes that are considered to be lowdollar. The Departments also seek 

comment on whether the offer cap 

should be set at the same value as the 

threshold, or whether the offer cap 

should be higher than the threshold to 

allow for some increase between offers 

made during open negotiation and offers 

made during the Federal IDR process. 

f. Administrative Fee Structure for NonInitiating Parties in Ineligible Disputes 

The Departments are proposing a 

framework to more equitably allocate 

costs between disputing parties while 

also incentivizing non-initiating parties 

to be responsive throughout the Federal 

IDR process, especially with respect to 

challenging the eligibility of a dispute. 

The Departments propose in 26 CFR 

54.9816–8(d)(2)(iii)(B), 29 CFR 

2590.716–8(d)(2)(iii)(B), and 45 CFR 

149.510(d)(2)(iii)(B) to charge a noninitiating party a reduced administrative 

fee when either the certified IDR entity 

or the Departments determine the entire 

dispute is ineligible for the Federal IDR 

process. The Departments also propose 

in 26 CFR 54.9816–8(d)(2)(iii)(B), 29 

CFR 2590.716–8(d)(2)(iii)(B), and 45 

CFR 149.510(d)(2)(iii)(B) that the 

reduced administrative fee amount for 

non-initiating parties in ineligible 

disputes would be 20 percent of the full 

administrative fee amount (proposed in 

section II.E.3.a. of this preamble), 

equating to $30 per non-initiating party 

per dispute if the administrative fee is 

finalized as proposed. 

For the reasons discussed in section 

II.D.1. of this preamble, implementing 

an efficient Federal IDR process requires 

both parties to be active participants in 

the process. As described in the 

‘‘Contested Dispute Eligibility’’ section 

of the Initial Report on the Federal 

Independent Dispute Resolution (IDR) 

Process, April 15–September 30, 

2022,183 submission of ineligible and 

incomplete disputes delays processing 

of disputes. The Departments are of the 

view that charging a reduced 

administrative fee to the non-initiating 

party for an ineligible dispute would 

more fairly allocate the costs to the 

Departments associated with ineligible 

disputes by assigning the majority of 

those costs to the party best suited to 

prevent submission of such disputes— 

the initiating party. If the Departments 

determine either or both parties have 

not acted in good faith in their 

submissions or responses, the 

Departments may decline to charge a 

reduced administrative fee. The 

Departments solicit comments on 

situations in which the Departments 

should decline to charge the noninitiating party a reduced administrative 

fee for an ineligible dispute, such as if 

the Departments obtain evidence that 

the non-initiating party withheld key 

information during open negotiation or 

initiation that the dispute was 

ineligible, and the Departments also 

solicit comments on additional 

approaches the Departments should 

consider to mitigate potential abuse of 

the proposed reduced administrative fee 

structure. 

Additionally, the No Surprises Act 

requires the administrative fee to be 

assessed to each party, but does not 

require the fee amount assessed to each 

party to be equal.184 While the noninitiating party did not actively choose 

to bring the dispute to the Federal IDR 

process, it would nonetheless utilize the 

features of the Federal IDR process 

proposed in these proposed rules, such 

as open negotiation and the Federal IDR 

Registry. However, the Departments are 

of the view that payment of a reduced 

administrative fee amount for noninitiating parties is appropriate when 

disputes are not eligible for the Federal 

IDR process. 

The Departments propose that this 

reduction would only be applied when 

the entire dispute is determined 

ineligible for the Federal IDR process. 

For example, if a batched dispute were 

determined to be partially ineligible 

(that is, some line items were eligible 

and some were ineligible), the noninitiating party may still be required to 

pay the full administrative fee amount, 

because the eligible line item(s) of the 

dispute would continue to move 

through the Federal IDR process. 

To develop the proposed 

administrative fee amounts for lowdollar disputes and ineligible disputes, 

the Departments considered several 

factors. Specifically, compared to 

ineligible disputes, the Departments are 

of the view that charging a higher 

reduced administrative fee amount for 

both parties in low-dollar disputes 

would be appropriate because lowdollar disputes generally proceed 

further in the Federal IDR process and 

result in either a payment determination 

or a negotiated settlement, and the 

additional Federal IDR process steps 

utilized by the parties incur additional 

expenses. However, non-initiating 

parties in ineligible disputes utilize 

fewer Federal IDR process steps because 

the dispute is closed before reaching a 

payment determination. In the event a 

low-dollar dispute is ineligible, the noninitiating party may be assessed the 

lower of the reduced administrative fee 

amounts, which would be the ineligible 

dispute reduced administrative fee 

amount. The Departments are of the 

view that this would be an equitable 

structure for both initiating and noninitiating parties and would help the 

Departments ensure that the total 

amount of administrative fees for each 

year is estimated to be equal to the 

amount of expenditures estimated to be 

made by the Departments to carry out 

the Federal IDR process, in compliance 

with the requirements of the No 

Surprises Act. 

To determine the projected amounts 

of the reduced administrative fees, the 

Departments evaluated various factors 

based on the data available to the 

Departments on both ineligible and lowdollar disputes, including: 

• Reduction of follow-up required for 

ineligible disputes; 

• Lower utilization of the Federal IDR 

portal for disputes that are closed as 

ineligible before a payment 

determination; and 

• The proportion of total disputes 

that are ineligible or low-dollar. 

After evaluating these factors, the 

Departments balanced the need to 

collect an administrative fee from all 

parties to disputes that utilize the 

Federal IDR portal with the need to 

equitably allocate burden across the 

parties, as well as the need to enable 

greater access to the Federal IDR 

process, and determined that assessing 

a reduced administrative fee amount of 

50 percent of the full administrative fee 

for both parties in a low-dollar dispute 

and 20 percent of the full administrative 

fee for the non-initiating party in an 

ineligible dispute would be appropriate. 

The Departments seek comment on 

this proposal, including whether the 

amount of the reduced administrative 

fee for non-initiating parties in 

ineligible disputes should be the same 

as the amount of the reduced 

administrative fee for both parties in 

low-dollar disputes discussed in section 

II.E.3.e. of this preamble. 


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4. Payment Determination 

a. Submission of Offers Deadline 

Sections 9816(c)(5)(B) and 

9817(b)(5)(B) of the Code, sections 

716(c)(5)(B) and 717(b)(5)(B) of ERISA, 

and sections 2799A–1(c)(5)(B) and 

2799A–2(b)(5)(B) of the PHS Act set 

forth that not later than 10 days after the 

date of selection of the certified IDR 

entity with respect to a determination 

for a qualified IDR item or service, the 

plan or issuer and the provider, facility, 

or provider of air ambulance services 

must each submit to the certified IDR 

entity an offer for a payment amount for 

such qualified IDR item or service. 

Under the October 2021 interim final 

rules, the Departments established that 

the offer must be submitted not later 

than 10 business days after the selection 

of the certified IDR entity. The 

Departments specified that parties to the 

Federal IDR process must also submit 

information requested by the certified 

IDR entity relating to the offer. 

To establish that the submission of 

offer is due from the provider, facility, 

or provider of air ambulance services 

and plan or issuer not later than 10 

business days after the date of final 

selection of the certified IDR entity, as 

discussed in section II.E.1.a.ii. of this 

preamble, the Departments propose to 

redesignate 26 CFR 54.9816–8(c)(4), 29 

CFR 2590.716–8(c)(4), and 45 CFR 

149.510(c)(4) as 26 CFR 54.9816–8(c)(5), 

29 CFR 2590.716–8(c)(5), and 45 CFR 

149.510(c)(5) and amend redesignated 

26 CFR 54.9816–8(c)(5)(i), 29 CFR 

2590.716–8(c)(5)(i), and 45 CFR 

149.510(c)(5)(i). This proposed 

amendment would establish that the 

time period for submission of offers 

would commence when the 

Departments notify the parties that the 

certified IDR entity has attested it has no 

conflicts of interest, or if the 

Departments have granted an extension 

to the eligibility determination 

timeframe described at proposed 26 CFR 

54.9816–8(g)(1)(ii)(A), 29 CFR 

2590.716–8(g)(1)(ii)(A), and 45 CFR 

149.510(g)(1)(ii)(A) due to extenuating 

circumstances, when an eligibility 

determination has been made. 

b. Payment Determination and 

Notification Deadline 

Sections 9816(c)(5)(A) and 

9817(b)(5)(A) of the Code, sections 

716(c)(5)(A) and 717(b)(5)(A) of ERISA, 

and sections 2799A–1(c)(5)(A) and 

2799A–2(b)(5)(B) of the PHS Act set 

forth that not later than 30 days after the 

date of selection of the certified IDR 

entity with respect to a determination 

for a qualified IDR item or service, the 

certified IDR entity will select one of the 

submitted offers to be the amount of 

payment for such item or service and 

will notify the provider or facility and 

the plan or issuer of the offer selected. 

Under the October 2021 interim final 

rules, the Departments established that 

the certified IDR entity must select an 

offer no later than 30 business days after 

the selection of the certified IDR entity 

and set forth other requirements for 

certified IDR entities when rendering 

payment determinations. 

These rules propose to redesignate 26 

CFR 54.9816–8(c)(4), 29 CFR 2590.716– 

8(c)(4), and 45 CFR 149.510(c)(4) as 26 

CFR 54.9816–8(c)(5), 29 CFR 2590.716– 

8(c)(5), and 45 CFR 149.510(c)(5), 

respectively, and the proposal described 

in this section reflects that 

redesignation. With regard to the 

requirements for payment determination 

and notification, at redesignated 26 CFR 

54.9816–8(c)(5)(ii), 29 CFR 2590.716– 

8(c)(5)(ii), and 45 CFR 149.510(c)(5)(ii), 

the Departments propose several 

amendments to align with other 

proposed updates to regulatory text, to 

make technical amendments, and to 

codify existing subregulatory guidance. 

The Departments propose to amend the 

regulatory text at 26 CFR 54.9816– 

8(c)(5)(ii), 29 CFR 2590.716–8(c)(5)(ii), 

and 45 CFR 149.510(c)(5)(ii) to reflect 

that the payment determination and 

notification deadline would be based on 

the date of final selection of the certified 

IDR entity, under proposed paragraph 

26 CFR 54.9816–8(c)(1)(iv)(C), 29 CFR 

2590.716–8(c)(1)(iv)(C), and 5 CFR 

149.510(c)(1)(iv)(C), which is described 

further in section II.E.1.a.ii. of this 

preamble. Similar to the proposed 

amendment to the submission of offers 

deadline, this proposed amendment 

would align the sections of regulatory 

text and specify that these time periods 

would not commence at the date of 

preliminary selection of the certified 

IDR entity (before the certified IDR 

entity attests it has no conflicts of 

interest), but rather would be based on 

the date of final selection of the certified 

IDR entity. Additionally, if the 

Departments grant an extension to the 

eligibility determination timeframe 

described at proposed 26 CFR 54.9816– 

8(g)(1)(ii)(A), 29 CFR 2590.716– 

8(g)(1)(ii)(A), and 45 CFR 

149.510(g)(1)(ii)(A) for extenuating 

circumstances, the submission of offers 

deadline would be based on the date of 

eligibility determination. This would 

create consistency across the timeframes 

for the Federal IDR process described in 

these rules and improve implementation 

of the Federal IDR process. 

Further, the Departments propose 

technical amendments to update the 

cross references in paragraphs 26 CFR 

54.9816–8(c)(5)(ii)(A) and (B), 29 CFR 

2590.716–8(c)(5)(ii)(A) and (B), and 45 

CFR 149.510(c)(5)(ii)(A) and (B) to 

reflect the proposed redesignation of 

paragraph 26 CFR 54.9816–8(c)(5), 29 

CFR 2590.716–8(c)(5), and 45 CFR 

149.510(c)(5). Within these paragraphs, 

reference to paragraphs (c)(4)(i) and 

(c)(4)(iii) would be updated to 

paragraphs (c)(5)(i) and (c)(5)(iii), 

respectively, and reference to 

paragraphs (c)(4)(ii)(A) and (c)(4)(vi) 

would be updated to paragraphs 

(c)(5)(ii)(A) and (c)(5)(vi), respectively. 

Finally, the Departments propose to 

codify definitions for the prevailing and 

non-prevailing parties, which were 

described in the Calendar Year 2022 Fee 

Guidance for the Independent Dispute 

Resolution Process and in the October 

2021 interim final rules. The 

Departments propose to add paragraphs 

26 CFR 54.9816–8(c)(5)(ii)(A)(1) and (2), 

29 CFR 2590.716–8(c)(5)(ii)(A)(1) and 

(2), and 45 CFR 149.510(c)(5)(ii)(A)(1) 

and (2), which would establish the 

definitions of prevailing and nonprevailing party in the case of single 

determinations or batched 

determinations. The Departments 

propose that a prevailing party, in the 

case of single determinations, would be 

the party whose offer is selected by the 

certified IDR entity. In the case of 

batched determinations, the prevailing 

party would be the party with the most 

determinations in its favor. The 

Departments propose that the nonprevailing party, in the case of single 

determinations, would be the party 

whose offer is not selected by the 

certified IDR entity and would be 

responsible for paying the certified IDR 

entity fee. In the case of batched 

determinations, the party with the 

fewest determinations in its favor is 

considered the non-prevailing party and 

would be responsible for paying the 

certified IDR entity fee. Codifying these 

definitions, already used by the certified 

IDR entities, would increase the clarity 

and consistency of regulatory 

requirements related to payment 

determinations and improve the parties’ 

understanding of certified IDR entity 

determinations. 

The Departments solicit comment on 

the proposals related to payment 

determination and notification. 

5. Extension of Time Periods for 

Extenuating Circumstances 

Under section 9816(c)(9) of the Code, 

section 716(c)(9) of ERISA, and section 

2799A–1(c)(9) of the PHS Act, and as 

explained in the October 2021 interim 

final rules and subregulatory guidance 

issued by the Departments, the time 

periods required under the No Surprises 


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185 26 CFR 54.9816–8T(g)(1), 29 CFR 2590.716– 

8(g)(1), and 45 CFR 149.510(g)(1). 

186 86 FR 56009 through 56010. 

Act and 26 CFR 54.9816–8T, 29 CFR 

2590.716–8, and 45 CFR 149.510 (other 

than the timing of the payments to 

prevailing parties) may be modified in 

the case of extenuating circumstances at 

the Departments’ discretion. 

Under current regulations,185 the 

Departments may extend time periods 

on a case-by-case basis if the extension 

is necessary to address delays due to 

matters beyond the control of the parties 

or for good cause, such as due to a 

natural disaster that prevents certified 

IDR entities, providers, facilities, 

providers of air ambulance services, 

plans, or issuers from complying with 

an applicable time period. In addition, 

the parties must attest that prompt 

action will be taken to ensure that a 

payment determination is made as soon 

as administratively practicable under 

the circumstances. As the October 2021 

interim final rules explain, parties may 

request an extension by submitting a 

Request for Extension due to 

Extenuating Circumstances through the 

Federal IDR portal, including an 

explanation about the extenuating 

circumstances and why the extension is 

needed.186 However, requesting an 

extension does not toll any of the 

Federal IDR process timeframes unless 

and until an extension is granted. 

Therefore, under this authority, the 

Departments propose, in accordance 

with sections 9816(c)(9) of the Code, 

section 716(c)(9) of ERISA, and section 

2799A–1(c)(9) of the PHS Act, to amend 

and add new provisions to 26 CFR 

54.9816–8(g), 29 CFR 2590.716–8(g), 

and 45 CFR 149.510(g). The 

Departments are proposing to amend 26 

CFR 54.9816–8T(g), 29 CFR 2590.716– 

8(g), and 45 CFR 149.510(g) to combine 

the information in existing paragraphs 

(g)(1)(i) and (g)(1)(ii) into paragraph 

(g)(1)(i) and to establish at paragraph 

(g)(1)(i) that the Departments, or at the 

request of a certified IDR entity or a 

party, would determine whether an 

extension is necessary because the 

parties or certified IDR entity cannot 

meet applicable timeframes due to 

matters beyond the control of the 

certified IDR entity or one or both 

parties, or for other good cause. Under 

these proposed rules, the Departments 

would provide an extension of the time 

periods if they identify unforeseen or 

good cause delays on a case-by-case 

basis, as opposed to solely relying on 

one of the parties to submit an extension 

request. The Departments may detect 

these issues before either party would 

and could immediately grant the 

necessary extension without having to 

wait for the submission of a formal 

request. Further, these proposed 

changes would create greater flexibility 

for certified IDR entities. For example, 

a certified IDR entity may receive a high 

volume of disputes that could lead to 

the certified IDR entity being unable to 

resolve payment determinations within 

the 30-business-day period. With the 

proposed changes to 26 CFR 54.9816– 

8(g)(1)(i), 29 CFR 2590.716–8(g)(1)(i), 

and 45 CFR 149.510(g)(1)(i), the 

certified IDR entity could submit an 

extension request for the Departments’ 

consideration. Often, the certified IDR 

entity may be best positioned to identify 

issues that warrant such an extension on 

a case-by-case basis. 

The Departments also propose to 

establish at 26 CFR 54.9816–8(g)(1)(ii), 

29 CFR 2590.716–8(g)(1)(ii), and 45 CFR 

149.510(g)(1)(ii) a generally applicable 

extension of time periods when the 

Departments determine that such 

extension is necessary due to 

extenuating circumstances that 

contribute to systematic delays in 

processing disputes under the Federal 

IDR process, such as a high volume of 

disputes or Federal IDR portal system 

failures. The Departments would post a 

public notice about any generally 

applicable extensions of time periods. 

For example, this proposed flexibility 

would be used, in addition to the 

generally applicable permission to toll 

timeframes during pending requests for 

additional information, to provide 

extensions when the volume of disputes 

initiated exceeds the certified IDR 

entities’ capacity to complete eligibility 

determinations within the 5-businessday timeframe proposed in these rules, 

and to provide extensions when 

systematic failures within the Federal 

IDR portal impact the parties’ and or 

certified IDR entities’ ability to comply 

with any of the required timeframes in 

the Federal IDR process. 

Under extenuating circumstances 

caused by an unforeseen high volume of 

disputes, the Departments would grant 

certified IDR entities an extension of the 

eligibility determination timeframe. The 

amount of time provided in such an 

extension would be determined by the 

Departments based on the volume of 

disputes and the number of active 

certified IDR entities at the time the 

extension is granted. An extension of 

the eligibility determination deadline, if 

granted by the Departments, would not 

alter the length of the subsequent 

timeframes in the Federal IDR process. 

Rather, the extended eligibility deadline 

would be a starting point for the other 

established IDR deadlines. Accordingly, 

the submission of an offer would be due 

10 business days after the extended 

eligibility determination timeframe and 

the payment determination would be 

due 30 business days after the extended 

eligibility determination timeframe, in 

accordance with the requirements 

established in statute and regulation. 

For example, if while monitoring IDR 

initiation data, the Departments detect a 

high volume of disputes initiated during 

the month of June and anticipate that 

the volume increase would prevent the 

certified IDR entities from reaching a 

payment determination within 30 

business days of final selection of the 

certified IDR entity, as required by 

regulation, the Departments would post 

a public notice indicating a 30-businessday extension of the eligibility 

timeframe for all disputes in which the 

certified IDR entity was selected on June 

1 through July 1. Rather than the 5- 

business-day eligibility determination 

deadline, certified IDR entities would 

have 30 business days to review 

eligibility on disputes initiated within 

this time period. In this example, a 

certified IDR entity was selected for a 

dispute on June 5 and attested to having 

no conflict of interest with respect to the 

dispute on June 6. The Departments 

would provide notice to the disputing 

parties that the certified IDR entity was 

selected on June 7, which would be the 

date of final selection of the certified 

IDR entity. The certified IDR entity 

would timely communicate the 

eligibility determination for the dispute 

by June 20, under the extension granted 

by the Departments. The date of 

eligibility determination (June 20) 

would become day 0 for calculating the 

remaining deadlines in the timeframe 

for the IDR process. As such, the 

submission of offer would be due from 

the disputing parties 10 business days 

(July 5) after the eligibility 

determination, and the payment 

determination would be due from the 

certified IDR entity 30 business days 

(August 2) after the eligibility 

determination. 

Under a second scenario, when a 

systematic failure of the Federal IDR 

portal impacts parties’ or certified IDR 

entities’ ability to comply with one or 

more of the required Federal IDR 

process timeframes, the Departments 

would grant the parties and/or the 

certified IDR entities an extension to the 

timeframe(s) which the Departments 

determine relevant. An extension under 

these circumstances would not alter the 

duration of the subsequent timeframes 

within the Federal IDR process, but, 

similar to the extension of eligibility 

determinations, would update the start 

dates of the subsequent timeframes. For 

example, if a systems failure crashed the 


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Federal IDR portal on June 1 and 2, the 

Departments could grant a general 

extension across all the Federal IDR 

process timeframes and apply an 

additional 2 business days to each 

relevant deadline on active disputes in 

the portal. In this example, if a noninitiating party’s deadline to submit the 

notice of IDR initiation response 

occurred during the portal outage, they 

would receive a 2-business-day 

extension beginning the day that the 

systems failure is rectified. The party’s 

new deadline for submitting the notice 

of IDR initiation response would be June 

6. 

Under these proposed changes the 

Departments would extend the time 

periods under the Federal IDR process 

without requiring a case-by-case 

analysis of individual extension 

requests. The Departments are of the 

view that granting certain extensions in 

this manner would provide protection 

for parties engaged in the Federal IDR 

process from the impact of systematic 

processing delays and ensure that 

unforeseen circumstances do not 

unfairly disadvantage a party or hinder 

its ability to comply with the Federal 

IDR process timeframes. This would 

also provide more transparency into the 

timing it would take for a dispute to be 

processed. 

The Departments seek comment on 

these proposals. 

F. Federal IDR Process Registration of 

Group Health Plans, Health Insurance 

Issuers, and Federal Employees Health 

Benefits Carriers 

The proposed addition of 26 CFR 

54.9816–9, 29 CFR 2590.716–9, and 45 

CFR 149.530 would require that plans 

and issuers subject to the Federal IDR 

process submit certain information to 

the Departments through a registry. As 

explained later in section IV., OPM’s 

regulations at 5 CFR 890.114 would 

require Federal Employees Health 

Benefits (FEHB) Program carriers to 

submit certain information through this 

registry. Upon submission of this 

information, each plan, issuer, or FEHB 

carrier would receive an IDR registration 

number (‘‘registration number’’). This 

registration number would make it 

easier for parties initiating disputes to 

acquire the information needed to 

ensure those disputes are eligible for the 

Federal IDR process. The registration 

number would help parties distinguish 

between different types of coverage 

(such as distinguishing between 

insurance coverage offered by an issuer, 

a self-insured group health plan for 

which an issuer serves as a TPA, or 

coverage offered by a FEHB carrier). The 

registry would be searchable, and 

parties would have access to the 

relevant registration number through the 

disclosure described in proposed 26 

CFR 54.9816–6(d), 29 CFR 2590.716– 

6(d), and 45 CFR 149.140(d), the notice 

described in proposed 26 CFR 54.9816– 

8(b)(1)(ii), 29 CFR 2590.716–8(b)(1)(ii), 

and 45 CFR 149.510(b)(1)(ii), and the 

response notice in proposed 26 CFR 

54.9816–8(b)(1)(iii), 29 CFR 2590.716– 

8(b)(1)(iii), and 45 CFR 

149.510(b)(1)(iii). Specifically, plans, 

issuers, and FEHB carriers would be 

required to provide the following 

information upon registration: (1) the 

legal business name (if any) of the group 

health plan, issuer, or FEHB carrier and, 

if applicable, the legal business name of 

the group health plan sponsor; (2) 

whether the plan or coverage is a selfor fully-insured group health plan 

subject to ERISA, individual health 

insurance coverage, a plan offered by a 

FEHB carrier, a self- or fully-insured 

non-Federal governmental plan, or a 

self- or fully-insured church plan; (3) 

the State(s) in which the plan or 

coverage is subject to a specified State 

law for any items or services to which 

the protections against balance billing 

apply; (4) the State(s) in which the plan 

or coverage is subject to an All Payer 

Model Agreement under section 1115A 

of the Social Security Act for any items 

or services to which the protections 

against balance billing apply; (5) for 

self-insured group health plans not 

otherwise subject to State law, any 

State(s) in which the group health plan 

has properly effectuated an election to 

opt in to a specified State law, if that 

State allows a plan not otherwise 

subject to the State law to opt in; and, 

for FEHB plans that adopt a specified 

State law pursuant to their FEHB 

carrier’s contract terms, any State(s) in 

which they have made such an 

adoption; (6) contact information, 

including a telephone number and 

email address, for the appropriate 

person or office to initiate open 

negotiations for purposes of determining 

an amount of payment (including cost 

sharing) for such item or service; (7) the 

14-digit Health Insurance Oversight 

System (HIOS) identifier, or, if the 14- 

digit HIOS identifier has not been 

assigned, the 5-digit HIOS identifier, or 

if no HIOS identifier is available, the 

plan’s or the plan sponsor’s Employer 

Identification Number (EIN) and the 

plan’s plan number (PN), if a PN is 

available; or for FEHB carriers, the 

applicable contract number(s) and plan 

code(s); (8) any additional information 

needed to identify the plan or issuer and 

the applicable Federal and State 

requirements for determining 

appropriate out-of-network payment 

rates for items or services to which the 

protections against balance billing 

apply, as specified by the Departments 

in guidance, or such additional 

information needed with respect to 

FEHB carriers as specified by OPM in 

guidance; and (9) any additional 

information needed for purposes of 

administrative fee collection, as 

specified by the Departments in 

guidance, or such additional 

information needed with respect to 

FEHB carriers as specified by OPM in 

guidance. 

The Departments would gather the 

registration information in a centralized 

IDR registry, which the Departments 

would make available through the 

Federal IDR portal to parties seeking to 

initiate an open negotiation or a dispute. 

The Departments solicit comment on 

whether to also make the registry 

available to the public. 

Plans and issuers with coverage 

subject to the Federal IDR process on 

the effective date of the final rules 

would be required to register within 30 

business days after the effective date of 

the final rules, if finalized, while plans 

and issuers that begin offering coverage 

subject to the Federal IDR process after 

the effective date of the final rules, if 

finalized, would be required to 

complete their initial registration on the 

date that they begin offering such 

coverage. In the event that the registry 

becomes available after the effective 

date of the final rule, plans and issuers 

would be required to register 30 

business days after the registry becomes 

available. Registered plans and issuers 

would be required to update the 

information associated with their 

Federal IDR registration number through 

the Federal IDR portal within 30 

business days of any change to the 

information reported in the registry and 

to confirm accuracy annually during the 

fourth quarter of each calendar year. A 

group health plan’s or health insurance 

issuer’s initial registration and 

subsequent updates to its registration 

information could be completed and 

submitted by a third party with 

authority to act on behalf of the group 

health plan or health insurance issuer. 

However, if a group health plan or 

health insurance issuer chooses to enter 

into such an agreement with a third 

party, the plan or issuer would retain 

responsibility for compliance with the 

proposed registration requirements. 

The Departments solicit comment on 

whether plans and issuers with coverage 

subject to the Federal IDR process on 

the effective date of the final rules 

would be able to register by 30 business 

days after the effective date of the final 


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rules or would need additional time to 

register. The Departments also solicit 

comment on the potential impact on 

providers, facilities, and providers of air 

ambulance services if plans and issuers 

are permitted additional time to register. 

In addition, the Departments are 

aware that plans and issuers often 

engage TPAs or other service providers 

to manage payment disputes subject to 

the Federal IDR process on their behalf. 

Accordingly, to reflect this existing 

industry practice, the Departments 

propose that the aforementioned 

requirements with respect to the registry 

under proposed 26 CFR 54.9816– 

9(b)(1)–(3), 29 CFR 2590.716–9(b)(1)– 

(3), and 45 CFR 149.530(b)(1)–(3) may 

be performed by a TPA or service 

provider with authority to act on behalf 

of the group health plan or health 

insurance issuer offering group or 

individual health insurance coverage 

subject to the Federal IDR process. The 

Departments propose that if the 

registration requirements are performed 

by such TPA or service provider, the 

group health plan or health insurance 

issuer offering group or individual 

health insurance coverage must require 

that such TPA or service provider 

clearly delineate each group health plan 

or health insurance issuer offering group 

or individual health insurance coverage 

for which the TPA or service provider 

has authority to act. Even where a third 

party performs the registration 

requirements, these proposed rules 

would still require that each group 

health plan or health insurance issuer 

offering group or individual health 

insurance coverage subject to the 

Federal IDR process be assigned a 

unique registration number. The 

Departments also propose to make clear 

that if such third party fails to provide 

the information in compliance with 

proposed 26 CFR 54.9816–9(b)(1)–(3), 

29 CFR 2590.716–9(b)(1)–(3), and 45 

CFR 149.530(b)(1)–(3), the plan or issuer 

would be in violation of the 

requirements of this section. The 

Departments solicit comments on this 

approach and whether there are any 

additional clarifications or flexibilities 

needed to ensure that the registry 

includes all relevant information for all 

parties that engage in the Federal IDR 

process. 

Proposed 26 CFR 54.9816–9, 29 CFR 

2590.716–9, and 45 CFR 149.530 are 

intended to address concerns that 

providers, facilities, and providers of air 

ambulance services shared with the 

Departments about initiating both open 

negotiation and the Federal IDR process. 

Initiating parties, particularly those that 

are providers, facilities, and providers of 

air ambulance services, report that they 

are often missing or cannot locate key 

information needed for open negotiation 

and the Federal IDR process despite the 

disclosure requirements established in 

sections 26 CFR 54.9816–6T(d)(1), 29 

CFR 2590.716–6(d)(1), and 45 CFR 

149.140(d)(1). First, the parties report 

difficulty finding the appropriate 

contact information to initiate open 

negotiation and the Federal IDR process. 

Second, they report difficulty 

determining whether the out-of-network 

rate for applicable items or services is 

governed by State or Federal law, 

including whether a self-insured plan 

has opted into a specified State law in 

States that allow these opt-ins. Third, 

they assert that it can be difficult to 

differentiate between multiple group 

health plans offered by the same plan 

sponsor, as well as between a fullyinsured plan offered by an issuer versus 

a self-insured group health plan 

administered by that issuer in its 

capacity as a TPA. Likewise, issuers and 

group health plan sponsors expressed 

concerns to the Departments that 

providers, facilities, and providers of air 

ambulance services sometimes initiate 

open negotiations or the Federal IDR 

process using incorrect contact 

information, or even initiate 

negotiations against the wrong plan or 

issuer. These communication 

difficulties present problems related to: 

(1) initiating open negotiation and the 

Federal IDR process with the correct 

party; (2) determining whether the items 

or services are eligible for the Federal 

IDR process; and (3) initiating correctly 

batched and bundled disputes that 

group together only items and services 

paid by the same plan or issuer. 

Given these concerns, the 

Departments are proposing to create a 

single registry of plans and issuers 

subject to the Federal IDR process to 

foster better communication between 

disputing parties. These changes would 

benefit all parties by reducing the need 

for time-consuming and expensive 

follow-up by disputing parties, certified 

IDR entities, and the Departments to 

obtain necessary information. 

The Departments recognize that plans 

and issuers have expressed concern 

about the burden of additional required 

disclosures. However, while plans and 

issuers would incur some additional 

administrative burden from providing 

plan and contact information through 

mandatory registration, the Departments 

are of the view that this approach also 

mitigates some administrative burden if 

the registry reduces the number of 

incorrectly submitted or incorrectly 

batched disputes. 

The Departments seek to minimize 

burden and ease compliance for plans 

and issuers by avoiding the issuance of 

duplicate registration numbers for the 

same plan or a single registration 

number for multiple plans. OPM 

similarly seeks to resolve concerns as 

discussed above, minimize burden and 

ease compliance for FEHB carriers. To 

that end, the Departments seek 

comment on the best way to separately 

identify multiple group health plans 

offered by the same plan sponsor, or 

multiple FEHB plans offered by the 

same FEHB carrier, and whether plans, 

issuers, or FEHB carriers would need to 

register multiple points of contact in 

their submissions to the IDR registry. 

To further minimize the reporting 

burden on plans, issuers, and FEHB 

carriers, the Departments are 

considering and solicit comment on 

whether to require plans, issuers, and 

FEHB carriers to register only after 

submitting or receiving their first open 

negotiation notice or only after receiving 

a certain number of disputes in a 

calendar year (for example, five 

disputes). Many group health plans are 

party to few, or no surprise billing 

disputes annually; excepting such 

parties from the registration requirement 

may minimize the regulatory burden on 

group health plans that receive few or 

no surprise billing disputes in a given 

year and could keep the registry size 

manageable. However, if registration is 

not universal, providers, facilities, and 

providers of air ambulance services may 

still experience difficulty accessing all 

information needed to initiate open 

negotiation and engage in the Federal 

IDR process with the subset of plans and 

issuers that would not be required to 

register. 

The Departments expect that 

providers, facilities, and providers of air 

ambulance services would make 

decisions about how and whether to 

initiate batched disputes based on the 

information submitted to the registry. 

The Departments, therefore, are 

considering and solicit comment on 

appropriate measures to address 

circumstances in which a provider or 

facility initiates a batched dispute in 

good faith based on information 

submitted by a plan or issuer as part of 

its registration and this dispute is later 

determined to be incorrectly batched. 

Finally, the Departments seek 

comment on this registration policy and 

what approaches should be adopted to 

ensure its accuracy, as well as whether 

submission of the offer as described in 

newly redesignated 26 CFR 54.9816– 

8(c)(5)(i), 29 CFR 2590.716–8(c)(5)(i), 

and 45 CFR 149.510(c)(5)(i) should be 

restricted until completion of the 

proposed registration. 


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G. Transparency Regarding In-Network 

and Out-of-Network Deductibles and 

Out-of-Pocket Limitation 

In addition to the challenges 

discussed previously, some interested 

parties have stated that it is difficult to 

know at the point of care whether a 

patient’s plan or coverage is subject to 

Federal or State surprise billing 

protections. In general, section 9816(e) 

of the Code, section 716(e) of ERISA, 

and section 2799A–1(e) of the PHS Act, 

as added by section 107 of division BB 

of the CAA, require a group health plan 

or a health insurance issuer offering 

group or individual health insurance 

coverage and providing or covering any 

benefit with respect to items or services 

to include, in clear writing, on any 

physical or electronic plan or insurance 

ID card issued to participants, 

beneficiaries, or enrollees, any 

applicable deductibles, any applicable 

out-of-pocket maximum limitations, and 

a telephone number and website 

address for individuals to seek 

consumer assistance information, such 

as information related to in-network 

hospitals and urgent care facilities. The 

Departments are considering, under the 

general rulemaking authority granted to 

the Departments to establish the Federal 

IDR process under section 9816(c)(2)(A) 

of the Code, section 716(c)(2)(A) of 

ERISA, and section 2799A–1(c)(2)(A) of 

the PHS Act, whether requiring that 

each plan or insurance card include 

information about whether the 

individual’s plan or coverage is subject 

to Federal or State surprise billing 

protections would facilitate information 

sharing with respect to the Federal IDR 

process. The Departments acknowledge 

that the ID cards may not be able to 

clarify the applicability of the Federal 

IDR process in all contexts, because in 

some States the Federal protections will 

apply for some items, services, and 

providers, while the State protections 

will apply for others. The Departments 

seek comment on this potential 

approach, including whether ID cards 

should display the plan or coverage type 

(such as, self-insured or fully-insured 

ERISA plan, non-Federal governmental 

plan, church plan, FEHB plan, or 

individual health insurance coverage), 

as well as whether a symbol or code 

could be included on cards that would 

indicate the applicable regulatory 

authority of the plan or coverage (that is, 

State or Federal entity, or both). 

H. Applicability 

1. Applicability Dates 

These proposed rules would modify 

and add to certain provisions of the July 

2021 and October 2021 interim final 

rules. Those interim final rules 

generally became applicable for plan 

years (in the individual market, policy 

years) beginning on or after January 1, 

2022. 

The provision proposed in 26 CFR 

54.9816–3, 29 CFR 2590.716–3, and 45 

CFR 149.30 to add the definition of 

bundled payment arrangement would 

apply beginning on the effective date of 

the final rules. These proposed rules 

would codify the existing definition set 

forth in guidance and would not require 

providers, facilities, providers of air 

ambulance services, plans, issuers, or 

certified IDR entities to modify existing 

processes or their own portals or 

systems to align with the proposed 

definition. Therefore, it would be 

appropriate for this definition to become 

applicable immediately upon the 

effective date of the final rules, if 

finalized. 

The provision in proposed new 26 

CFR 54.9816–6A, 29 CFR 2590.716–6A, 

and 45 CFR 149.100 that plans and 

issuers communicate information using 

CARCs and RARCs, as specified in 

guidance, would apply beginning on the 

effective date of the final rules, if 

finalized. The Departments would issue 

future guidance on the use of CARCs 

and RARCs in both electronic 

transactions and formats outside the 

purview of the HIPAA transaction 

standards, including paper remittance 

advice, to implement this proposed 

regulatory requirement. Should this 

proposal be finalized, the Departments 

recognize that plans and issuers would 

need time to make systems changes and 

other modifications to operationalize 

the use of CARCs and RARCs and are 

considering an approach under which 

the final rules would establish the 

implementation timeframe for the use of 

CARCs and RARCs following the 

issuance of guidance. For example, the 

final rules could specify that the 

requirement to use a specified CARC or 

RARC applies beginning on the date that 

is a certain timeframe, such as 6 months 

or 1 year, after the issuance of guidance. 

Alternatively, the final rules could 

provide that guidance issued by the 

Departments would establish an interval 

of not less than, for example, 6 months 

between when guidance is issued and 

when plans and issuers must begin 

using a specified CARC or RARC. This 

would balance plans’ and issuers’ 

interest in certainty in a minimum 

implementation timeframe while 

allowing for flexibility where the 

Departments determine necessary. The 

Departments seek comments on these 

potential approaches, including what 

timeframe would provide plans and 

issuers sufficient time to comply. 

The proposed modifications to the 

regulations at 26 CFR 54.9816–6(d), 29 

CFR 2590.716–6(d), and 45 CFR 

149.140(d) addressing information to be 

shared about the QPA would apply to 

disclosures required to be provided on 

or after the effective date of the final 

rules, if finalized. The Departments note 

that many of these proposed changes are 

simply corrections or clarifications that 

would not substantially affect current 

plan or issuer operations. While these 

disclosures would be required to 

include some new content—namely a 

statement that a provider, facility, or 

provider of air ambulance services must 

notify the Departments when initiating 

open negotiation, the legal business 

name of the plan and plan sponsor (if 

applicable) and issuer, and the 

registration number assigned under 

these proposed rules—the Departments 

do not anticipate significant operational 

burden for plans and issuers to modify 

existing processes to include this 

information. The proposed regulatory 

text makes clear that plans and issuers 

would not be required to include a 

statement about notifying the 

Departments to initiate open negotiation 

until the open negotiation notice can be 

submitted through the Federal IDR 

portal. Further, plans and issuers would 

not be required to include their assigned 

registration number until the Federal 

IDR registry becomes available and the 

plan or issuer is registered. 

The proposed modifications to the 

Federal IDR process that would apply to 

disputes with open negotiation periods 

beginning on or after the later of August 

15, 2024, or 90 days after the effective 

date of the final rules, if finalized, 

include: 

• The requirements for batched 

qualified IDR items and services in 26 

CFR 54.9816–8(a)(2)(i), 29 CFR 

2590.716–8(a)(2)(i) and 45 CFR 

149.510(a)(2)(i); 

• The provisions regarding the open 

negotiation notice, open negotiation 

response notice, notice of IDR initiation, 

and notice of IDR initiation response in 

26 CFR 54.9816–8(b), 29 CFR 2590.716– 

8(b) and 45 CFR 149.510(b); 

• The proposed rules governing the 

selection of a certified IDR entity, the 

Federal IDR process eligibility review, 

the authority to continue negotiations or 

withdraw, and the treatment of batched 

and bundled qualified IDR items and 

services in 26 CFR 54.9816–8(b) and 

(c)(1) through (c)(4), 29 CFR 2590.716– 

8(b) and (c)(1) through (c)(4), and 45 

CFR 149.510(b) and (c)(1) through (c)(4); 

and 

• Modifications made to the deadline 

for the submission of offers and 

payment determination and notification 


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187See Section 504 of ERISA (providing DOL 

with authority to determine whether any person has 

violated or is about to violate any provision of 

ERISA or any regulation or order thereunder, 

including with regard to group health plans); 

section 2723 of the PHS Act and 45 CFR 150.101 

et seq. (setting forth HHS’s enforcement procedures 

related to the provisions of title XXVII of the PHS 

Act, including bases for initiating investigations 

and performing market conduct examinations). For 

an overview of applicable enforcement 

mechanisms, see also Staman, Jennifer (2020). 

‘‘Federal Private Health Insurance Market Reforms: 

Legal Framework and Enforcement,’’ Congressional 

Research Service, available at https://

crsreports.congress.gov/product/pdf/R/R46637. 

188The preamble to the July 2021 interim final 

rules states, ‘‘In contrast to situations where a 

participant, beneficiary, or enrollee is able to travel 

using nonmedical transportation or nonemergency 

medical transportation following stabilization, in 

the event that the individual requires medical 

transportation to travel, including transportation by 

either ground or air ambulance vehicle, the 

individual is not in a condition to receive notice or 

provide consent. Therefore, the surprise billing 

protections continue to apply to post-stabilization 

services provided in connection with the visit for 

which the individual received emergency services.’’ 

86 FR 36872, 36881 (July 13, 2021). 

189Beginning in 2025, the President’s Fiscal Year 

2024 budget proposal extends surprise billing 

protections to ground ambulance services across the 

commercial market. See U.S. Department of Health 

and Human Services. Fiscal Year 2024 Budget in 

Brief, (2023), p.99, available at https://

www.hhs.gov/sites/default/files/fy-2024-budget-inbrief.pdf. 

in 26 CFR 54.9816–8(c)(5)(i) and (ii), 29 

CFR 2590.716–8(c)(5)(i) and (ii), and 45 

CFR 149.510(c)(5)(i) and (ii); and 

• Modifications made to the 

suspension of certain subsequent IDR 

requests and subsequent submission of 

requests submitted in 26 CFR 54.9816– 

8(c)(5)(vii)(B) and (C), 29 CFR 2590.716– 

8(c)(5)(vii)(B) and (C), and 45 CFR 

149.510(c)(5)(vii)(B) and (C). 

The Departments recognize that each 

of these proposed changes would 

require providers, facilities, providers of 

air ambulance services, plans, issuers, 

and certified IDR entities to modify 

existing processes and their own portals 

or systems to align with the proposed 

requirements. For example, some 

certified IDR entities may need to 

update their own proprietary portals 

used to facilitate their eligibility and 

payment determinations to align with 

the new batching requirements. Further, 

the Departments would need to design 

and implement system changes to the 

Federal IDR portal, such as allowing the 

disputing parties to submit new and 

updated notices through the Federal IDR 

portal and updating the system’s 

collection of newly permissible batched 

disputes. This proposed applicability 

date is intended to ensure the 

Departments, disputing parties, and 

certified IDR entities have sufficient 

time to understand the proposed 

changes to the Federal IDR process and 

modify current operations. 

The proposed modifications to the 

regulations at 26 CFR 54.9816–8(d), 29 

CFR 2590.716–8(d), and 45 CFR 

149.510(d) addressing the time and 

manner of payment and collection of the 

administrative and certified IDR entity 

fees, the procedures in the event that 

either party fails to timely pay the 

administrative or certified IDR entity 

fee, and the framework for establishing 

the administrative and certified IDR 

entity fee structures would apply to 

disputes initiated on or after January 1, 

2025. Similar to the proposed open 

negotiation, IDR initiation, and batched 

determination requirements, the 

Departments would need sufficient time 

to modify current operations so that the 

Departments could charge and collect 

the administrative fees directly from the 

parties, which are currently collected by 

the certified IDR entities and 

subsequently remitted to the 

Departments. The Departments would 

also need to update their payment 

systems and the Federal IDR portal to 

implement the proposed consequences 

when either party fails to pay the 

certified IDR entity fee or the 

administrative fee, such as the proposals 

to close a dispute when the initiating 

party fails to pay the administrative fee 

on time and to prohibit the noninitiating party from submitting an offer 

when the non-initiating party fails to 

pay the administrative fee or certified 

IDR entity fee in accordance with the 

proposed timeframes. 

The proposed changes at 26 CFR 

54.9816–8(e)(2)(vi), (viii), and (ix), 29 

CFR 2590.716–8(e)(2)(vi), (viii), and (ix), 

and 45 CFR 149.510(e)(2)(vi), (viii), and 

(ix) regarding the certified IDR entity’s 

controls to prevent and detect improper 

financial activities, and procedures to 

retain the certified IDR entity fee and 

administrative fee are minor in nature, 

and therefore these proposed rules 

would be applicable upon the effective 

date of the final rules, if finalized. 

The proposed changes at 26 CFR 

54.9816–8(g), 29 CFR 2590.716–8(g), 

and 45 CFR 149.510(g) regarding the 

extension of time periods for 

extenuating circumstances would be 

applicable to disputes with open 

negotiation periods beginning on or 

after the later of August 15, 2024, or 90 

days after the effective date of the final 

rules, if finalized. 

Until the relevant applicability date 

for the requirements of 26 CFR 54.9816– 

8, 29 CFR 2590.716–8, and 45 CFR 

149.510, plans, issuers, providers, 

facilities, providers of air ambulance 

services, and certified IDR entities are 

required to continue to comply with the 

corresponding section of 26 CFR 

54.9816–8, 29 CFR 2590.716–8, and 45 

CFR 149.510, contained in the CFR as of 

October 25, 2022. In order to ensure 

compliance with these proposed 

requirements, the Departments would 

generally use existing processes for 

enforcing the relevant provisions of the 

Code, ERISA, and PHS Act that apply to 

group health plans and health insurance 

issuers, including the provisions added 

by the No Surprises Act.187 The 

Departments intend to monitor for noncompliance with these proposed 

requirements when applicable, if 

finalized. 

Finally, provisions that would 

establish the Federal IDR registry, and 

the associated requirements at proposed 

26 CFR 54.9816–9, 29 CFR 2590.716–9, 

and 45 CFR 145.530 would become 

applicable on the effective date of the 

final rules, if finalized. Pursuant to the 

establishment of the registry, the 

requirements in proposed new 26 CFR 

54.9816–9, 29 CFR 2590.716–9, and 45 

CFR 145.530 would require that each 

plan or issuer subject to the Federal IDR 

process complete its initial registration 

in the newly established Federal IDR 

registry by the later of the date that is 

30 business days after the registry 

becomes available or the date the group 

health plan or health insurance issuer 

begins offering group or individual 

health insurance coverage. 

The Departments seek comment on 

whether disputing parties and certified 

IDR entities would need additional time 

to implement the proposed 

modifications after the final rules are 

published, if finalized. 

2. Applicability of Surprise Billing 

Protections to Ground Ambulance 

Services 

The Departments have received 

questions about how the surprise billing 

protections under the No Surprises Act 

apply to ground ambulance services. In 

particular, the Departments understand 

that some plans and issuers have 

construed a statement in the preamble 

to the July 2021 interim final rules 

addressing when a participant, 

beneficiary, or enrollee is in a condition 

to receive notice and provide consent to 

waive surprise billing protections for 

post-stabilization services 188 to mean 

that the No Surprises Act surprise 

billing protections apply to poststabilization inter-facility ground 

ambulance transports. The Departments 

do not interpret the No Surprises Act’s 

surprise billing provisions to apply to 

emergency or non-emergency ground 

ambulance services.189 This includes 

transport by ground ambulance after a 

participant, beneficiary, or enrollee has 

been stabilized and needs to be 


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190 In contrast, if a plan or issuer provides or 

covers benefits for air ambulance services (such as 

inter-facility air ambulance transports), those 

services are subject the No Surprises Act surprise 

billing protections. See FAQs about Affordable Care 

Act and Consolidated Appropriations Act, 2021 

Implementation Part 55, Q7 (Aug. 19, 2022), 

available at https://www.dol.gov/sites/dolgov/files/ 

EBSA/about-ebsa/our-activities/resource-center/ 

faqs/aca-part-55.pdf and https://www.cms.gov/files/ 

document/faqs-part-55.pdf. 

191For more information about the Advisory 

Committee on Ground Ambulance and Patient 

Billing, see https://www.cms.gov/regulationsguidance/advisory-committees/advisory-committeeground-ambulance-and-patient-billing-gapb. 

192Sections 9816(c)(2)(A) and 9817(b)(2)(A) of the 

Code, sections 716(c)(2)(A) and 717(b)(2)(A) of 

ERISA, and sections 2799A–1(c)(2)(A) and 2799A– 

2(b)(2)(A) of the PHS Act. 

transferred to another facility for 

continued observation or treatment.190

Instead, Congress enacted section 117 of 

the No Surprises Act, which requires 

the Departments to establish and 

convene an advisory committee for the 

purpose of reviewing options to 

improve the disclosure of charges and 

fees for ground ambulance services, 

better inform consumers of insurance 

options for such services, and protect 

consumers from balance billing. The 

advisory committee must submit a 

report that includes recommendations 

for the disclosure of charges and fees for 

ground ambulance services and 

insurance coverage, consumer 

protections and enforcement authorities 

of the Departments and States, and the 

prevention of balance billing to 

consumers.191

III. Severability 

It is the Departments’ intent that if 

any provision of these proposed rules, if 

finalized, is held to be invalid or 

unenforceable by its terms, or as applied 

to any person or circumstance, these 

rules shall be construed so as to 

continue to give maximum effect to 

these rules as permitted by law, unless 

the holding shall be one of utter 

invalidity or unenforceability. In the 

event a provision is found to be utterly 

invalid or unenforceable, the provision 

shall be severable from these proposed 

rules as finalized, as well as the interim 

final rules and final rules they amend 

and shall not affect the remainder 

thereof or the application of the 

provision to persons not similarly 

situated or to dissimilar circumstances. 

According to the statute,192 the 

Departments must establish a Federal 

IDR process that plans and issuers and 

nonparticipating providers and facilities 

may utilize to resolve certain disputes 

regarding out-of-network rates under 

section 9816 of the Code, section 716 of 

ERISA, and section 2799A–1 of the PHS 

Act, including the time, manner, and 

amount each party to a determination 

must pay to participate in the Federal 

IDR process. Further, under section 

9816(a)(2)(B)(ii) of the Code, section 

716(a)(2)(B)(ii) of ERISA, and section 

2799A–1(a)(2)(B)(ii) of the PHS Act, the 

Departments have authority to establish 

through rulemaking the information that 

a plan or issuer must share with a 

provider or facility when determining 

the QPA, including the form and 

manner of such disclosures. Under 

section 9816(c)(9) of the Code, section 

716(c)(9) of ERISA, and section 2799A– 

1(c)(9) of the PHS Act, the Departments 

also may, at their discretion, modify any 

deadline or other timing requirement of 

the Federal IDR process (except for the 

timing of payment following a payment 

determination) in cases of extenuating 

circumstances, as specified by the 

Departments, or to ensure that all claims 

that are subject to the 90-calendar-day 

cooling-off period submitted to the 

Federal IDR process are in fact eligible 

for the Federal IDR process. 

For the reasons described in section 

II. of this preamble, the Departments are 

of the view that their authority to 

implement each of these aspects in the 

proposed regulation is well-supported 

in law and practice and should be 

upheld in any legal challenge. The 

Departments are also of the view that 

the exercise of their authority reflects 

sound policy. However, if any portion of 

these proposed rules is declared invalid, 

the Departments intend that the various 

aspects related to the Federal IDR 

process be severable. For example, if a 

court were to find unlawful (1) the 

requirement to use CARC and RARCs, 

(2) the standards for the open 

negotiation period, (3) the provision for 

the treatment of batched determinations, 

(4) the provision for departmental 

eligibility review, (5) the administrative 

fee requirements, or (6) the provision of 

extensions of timeframes under 

extenuating circumstances, or some 

combination thereof, the Departments 

still would intend the remaining 

features of the policy to stand. Further, 

the Departments also intend for parts of 

certain provisions in these rules to be 

severable. For example, if a court were 

to find unlawful (1) the policy of 

batching qualified IDR items and 

services furnished to a single patient on 

the same or consecutive dates of service 

and billed on the same claim form 

(single patient encounter), (2) the policy 

of batching qualified IDR items and 

services billed under the same service 

code or a comparable code under a 

different procedural coding system, or 

(3) the policy of batching 

anesthesiology, radiology, pathology, 

and laboratory qualified IDR items and 

services under service codes belonging 

to the same Category I CPT code section, 

or some combination thereof, the 

Departments still would intend the 

remaining features of the policy to 

stand. 

While the proposed policies in 

combination in these proposed rules 

would ameliorate different difficulties 

in the Federal IDR process and result in 

a more efficient and transparent process 

for the disputing parties and certified 

IDR entities, the Departments intend for 

each of the proposed policies to 

function independently and be 

severable from another. The 

Departments have added severability 

clauses to these proposed rules to 

emphasize the Departments’ intent that, 

to the extent a reviewing court holds 

that any provision of the final rules is 

unlawful, the remaining rules should 

take effect and be given the maximum 

effect permitted by law. The 

Departments have also added 

severability clauses to these proposed 

rules to emphasize the Departments’ 

intent that the provisions in 26 CFR 

54.9816–6A, 54.9816–6, 54.9816–8, and 

54.9816–9; 29 CFR 2590.716–6A, 

2590.716–6, 2590.716–8, and 2590.716– 

9; and 45 CFR 149.100, 149.140, 149.510 

and 149.530 are intended to be 

severable from one another. 

The proposed severability provisions 

in these rules, if finalized, would not 

conflict with the proposed severability 

provisions in the IDR Process Fees 

proposed rules, if those provisions are 

finalized. In the IDR Process Fees 

proposed rules the Departments 

proposed severability provisions in new 

proposed paragraphs 26 CFR 54.9816– 

8(d)(3)(i) and (ii), 29 CFR 2590.716– 

8(d)(3)(i) and (ii), and 45 CFR 

149.510(d)(3)(i) and (ii). Those proposed 

paragraphs state that if any of the 

administrative fee or certified IDR entity 

fee proposals in the IDR Process Fees 

proposed rules, as finalized, are held to 

be unlawful by a court, the remaining 

rules should take effect and be given the 

maximum effect permitted by law. 

If the severability provisions proposed 

in the IDR Process Fees proposed rules 

are finalized and subsequently, the 

severability provisions proposed in 

these rules in new proposed paragraphs 

26 CFR 54.9816–8(i)(1) and (2), 29 CFR 

2590.716–8(i)(1) and (2), and 45 CFR 

149.510(i)(1) and (2) are also finalized, 

the Departments would remove the 

severability provisions proposed in the 

IDR Process Fees proposed rules at 26 

CFR 54.9816–8(d)(3)(i) and (ii), 29 CFR 

2590.716–8(d)(3)(i) and (ii), and 45 CFR 

149.510(d)(3)(i) and (ii).The purpose for 

this proposed approach would be to 


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193OPM also proposes a technical correction in 

5 CFR 890.114 that would add a cross-reference to 

26 CFR 54.9817–2, which concerns the independent 

dispute resolution process for air ambulance 

services. The addition of this cross-reference is 

necessary because 5 CFR 890.114 also cites to 

parallel provisions at 29 CFR 2590.717–2 and 45 

CFR 149.520. 

194For a description of the proposal to require 

parties to notify the Departments when they initiate 

open negotiation, see section II.D.1. of this 

preamble. 

simplify the Federal IDR process 

regulations and have one regulation 

section for the severability provisions 

applicable to the entire Federal IDR 

process, as proposed 26 CFR 54.9816– 

8(i)(1) and (2), 29 CFR 2590.716–8(i)(1) 

and (2), and 45 CFR 149.510(i)(1) and 

(2). 

IV. Overview of the Proposed Rules— 

Office of Personnel Management 

OPM proposes to amend existing 5 

CFR 890.114(a) to include references to 

the Departments’ regulations.193 OPM 

has the responsibility of administering 

the Federal Employees Health Benefits 

(FEHB) Program. This responsibility 

includes maintaining oversight and 

enforcement authority for FEHB plans, 

which are Federal governmental plans. 

In the July and October 2021 interim 

final rules, OPM adopted the 

Departments’ regulations that 

implement the sections of the Code, 

ERISA, and the PHS Act that are 

referenced in 5 U.S.C. 8902(p). 

Generally, under 5 U.S.C. 8902(p), each 

FEHB contract must require a carrier to 

comply with requirements described in 

the Code, ERISA, and PHS Act in the 

same manner as they apply to a group 

health plan or health insurance issuer. 

Subject to OPM regulations and 

contract provisions, FEHB carriers must 

comply with the specified provisions of 

the Departments’ regulations. The 

proposed amendments to 5 CFR 890.114 

would allow for continued conformity, 

oversight, and enforcement. 

Specifically, through 5 CFR 890.114 and 

its proposed amendments, FEHB 

carriers and their plans would be 

required to comply with all provisions 

of these proposed rules. Among other 

things, FEHB carriers would be required 

to: 

• Comply with the proposed rules’ 

new requirements relating to the 

disclosure of information that FEHB 

carriers must include along with the 

initial payment or notice of denial of 

payment for certain items and services 

subject to the surprise billing 

protections in the No Surprises Act; 

• Communicate information by using 

CARCs and RARCs when providing any 

paper or electronic remittance advice to 

an entity that does not have a 

contractual relationship with the FEHB 

carrier; 

• Comply with amended 

requirements related to the open 

negotiation period preceding the 

Federal IDR process, the initiation of the 

Federal IDR process, the Federal IDR 

dispute eligibility review, and the 

payment and collection of 

administrative fees; 

• Comply with amended 

requirements related to the extension of 

timeframes due to extenuating 

circumstances, batched items and 

services, and bundled payment 

arrangements; and 

• Register in the Federal IDR portal 

established by the Departments and 

provide the required data elements as 

applicable to FEHB carriers. 

V. Economic Impact and Paperwork 

Burden 

A. Summary—Departments of Health 

and Human Services and Labor 

These proposed rules would add new 

26 CFR 54.9816–6A, 29 CFR 2590.716– 

6A, and 45 CFR 149.100 requiring plans 

and issuers to use CARCs and RARCs, 

as specified in guidance issued by the 

Departments, or as required under any 

applicable, adopted standards and 

operating rules under 45 CFR part 162, 

on both electronic and paper remittance 

advice, to communicate information 

related to whether a claim for an item 

or service furnished by an entity that 

does not have a direct or indirect 

contractual relationship with the plan or 

issuer for the furnishing of such item or 

service under the plan or coverage is 

subject to the provisions of 26 CFR 

54.9816 and 54.9817; 29 CFR 2590.716 

and 2590.717; or 45 CFR part 149, 

subpart B, E, or F. The Departments 

further propose amendments to existing 

regulations to specify that plans and 

issuers must, in the case of air 

ambulance services, disclose the QPA 

and certain information about the QPA 

when cost sharing is calculated using 

the QPA. These proposed changes 

would reflect that the term ‘‘recognized 

amount’’ is not used with respect to air 

ambulance services and make technical 

corrections to address omissions where 

providers of air ambulances were not 

listed alongside other providers and 

facilities in the current regulatory text. 

The Departments also propose to 

revise the regulation addressing 

information to be shared about the QPA 

to make clear these disclosures are 

required when the recognized amount 

(or for air ambulance services, the 

amount on which cost sharing is based) 

is the QPA or the amount billed by the 

provider, facility, or provider of air 

ambulance services. 

The Departments also propose 

amendments to the content of the 

statement required under the 

regulations regarding the information to 

be shared about the QPA. Specifically, 

the Departments propose that the 

required statement specify that the 30- 

day period for open negotiation is 30 

business days; reference providers of air 

ambulance services (in addition to 

providers and facilities); specify that a 

party wishing to initiate open 

negotiation must provide the required 

notice within 30 business days of 

receiving an initial payment or notice of 

denial of payment; and include 

language notifying the provider, facility, 

or provider of air ambulance services 

that they must notify the Departments 

and the plan or issuer to initiate the 

open negotiation period.194 The 

Departments also propose to require 

plans and issuers to disclose the legal 

business name of the plan (if any) or 

issuer; the legal business name of the 

plan sponsor (if applicable); and the 

registration number assigned under 

proposed 26 CFR 54.9816–9, 29 CFR 

2590.716–9, or 45 CFR 149.530, as 

applicable, if the plan or issuer is 

registered with the Federal IDR registry. 

These proposed rules also would 

require the party initiating open 

negotiations to provide an open 

negotiation notice and supporting 

documentation to the other party and 

the Departments via the Federal IDR 

portal to initiate the open negotiation 

period. The Departments also propose to 

require several new content 

requirements for the open negotiation 

notice. Furthermore, these proposed 

rules would require the party in receipt 

of the open negotiation notice to 

provide a response to the open 

negotiation notice, with specified 

content, and supporting documentation 

to the other party and the Departments 

no later than the 15th business day of 

the 30-business-day open negotiation 

period. 

In addition, the Departments propose 

to amend the notice of IDR initiation 

content requirements to require the 

initiating party to submit certain 

additional information in the notice of 

IDR initiation. The Departments also 

propose that the non-initiating party 

must submit a written response to the 

notice of IDR initiation to the initiating 

party and to the Departments within 3 

business days after the date of IDR 

initiation. These proposed rules would 

require the notice of IDR initiation 


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response to include an attestation that 

the item or service that is the subject of 

the dispute is a qualified IDR item or 

service or an assertion that the item or 

service is not a qualified IDR item or 

service, and an explanation and 

documentation to support the assertion. 

Furthermore, the Departments propose 

that the non-initiating party would also 

be required to indicate in the notice of 

IDR initiation response whether they 

agree or object to the initiating party’s 

preferred certified IDR entity and 

provide a statement designating an 

alternative preferred certified IDR entity 

if the non-initiating party objects to the 

initiating party’s preferred certified IDR 

entity. 

These proposed rules would require 

parties furnishing the open negotiation 

notice, open negotiation response 

notice, notice of IDR initiation, and 

notice of IDR initiation response to 

provide the notices and supporting 

documentation to the other party and 

the Departments on the same day via the 

Federal IDR portal. 

The Departments propose that if the 

party last in receipt of either the notice 

of IDR initiation response or the notice 

of certified IDR entity selection received 

the notice on the third business day 

after the date of IDR initiation, the 

Departments would provide the party 2 

additional business days to agree or 

object to other party’s alternative 

preferred certified IDR entity selection. 

The Departments propose that if the 

party agrees with the other party’s 

alternative preferred certified IDR entity 

and notifies the Departments of such 

agreement, or if the party fails to notify 

the Departments of its objection by the 

fifth business day after the date of IDR 

initiation, the Departments would select 

the alternative preferred certified IDR 

entity as the certified IDR entity for the 

dispute. The Departments propose that 

if the party notifies the Departments of 

its objection to the alternative preferred 

certified IDR entity by the fifth business 

day after the date of IDR initiation, the 

Departments would proceed with 

random selection of the certified IDR 

entity. 

Furthermore, the Departments 

propose to specify that the date of 

preliminary selection of the certified 

IDR entity would be 3 business days 

after the date of IDR initiation if the 

parties jointly selected a certified IDR 

entity, or 6 business days after the date 

of IDR initiation if the parties fail to 

agree and jointly select a certified IDR 

entity, and the Departments randomly 

select a certified IDR entity. These 

proposed rules would establish that if a 

selected certified IDR entity attests to 

having a conflict of interest, the 

Departments would randomly select 

another certified IDR entity, and the 

date of final selection of the certified 

IDR entity would be the date the 

Departments provide notice to the 

parties that the new certified IDR entity 

has attested that it meets the conflict-ofinterest requirements. 

The Departments propose to establish 

several requirements regarding 

eligibility determinations. Specifically, 

the Departments propose that after the 

selected certified IDR entity attests that 

it meets the conflict-of-interest 

requirements, the selected certified IDR 

entity must review the information 

provided in the notice of IDR initiation 

and notice of IDR initiation response, as 

well as any additional information 

requested and received, and make an 

eligibility determination no later than 5 

business days after the date of final 

selection of the certified IDR entity. 

These proposed rules would also 

establish a departmental eligibility 

review when the Departments, in their 

discretion, determine that application of 

the departmental eligibility review is 

necessary to facilitate timely payment 

determinations or the effective 

processing of disputes under the Federal 

IDR process. When the departmental 

eligibility review is in effect, the 

Departments would make eligibility 

determinations, as opposed to the 

certified IDR entities. The Departments 

propose to provide reasonable notice 

before the Departments invoke the 

departmental eligibility review and 

before ceasing to use the departmental 

eligibility review. 

The Departments further propose to 

establish a process for disputes to be 

withdrawn from the Federal IDR 

process. Specifically, the Departments 

propose that a dispute may be 

withdrawn from the Federal IDR process 

if: (1) the initiating party provides 

notification through the Federal IDR 

portal to the Secretary and the certified 

IDR entity (if selected) that both parties 

agree to withdraw the dispute from the 

Federal IDR process, with signatures 

from authorized signatories for both 

parties; (2) the initiating party provides 

a standard withdrawal request notice to 

the Departments, the certified IDR entity 

(if selected), and the non-initiating party 

and the non-initiating party notifies the 

Secretary, certified IDR entity (if 

selected), and initiating party of its 

agreement to withdraw the dispute 

within 5 business days of the initiating 

party’s request (or the non-initiating 

party fails to respond within 5 business 

days of the initiating party’s request); (3) 

the certified IDR entity or the 

Departments cannot determine 

eligibility because both parties are 

unresponsive to any requests for 

additional information to determine 

eligibility; or (4) the certified IDR entity 

cannot make a payment determination 

because both parties have failed to 

submit an offer as described in section 

II.E.4. of this preamble. 

The Departments also propose to 

amend the batching policies for the 

Federal IDR process to increase 

efficiency and create a workable 

framework for disputing parties and 

certified IDR entities. Specifically, the 

Departments propose to allow qualified 

IDR items and services to be batched if: 

(1) the items and services were 

furnished to a single patient during a 

patient encounter on one or more 

consecutive dates of service and billed 

on the same claim form (single patient 

encounter); (2) the items and services 

were furnished to one or more patients 

and were billed under the same service 

code, or a comparable code under a 

different procedural code system; or (3) 

anesthesiology, radiology, pathology, 

and laboratory qualified IDR items and 

services were furnished under service 

codes belonging to the same Category I 

CPT code range, as specified in 

guidance by the Departments. These 

proposed rules would also require that 

no more than 25 qualified IDR items and 

services may be considered jointly as 

part of one payment determination for 

the purposes of batched determinations. 

The Departments further propose 

several changes to the collection of the 

administrative fee. First, in addition to 

proposing new administrative fee 

amounts and a revised methodology for 

calculating such amounts, the 

Departments propose that the initiating 

party must pay the administrative fee 

within 2 business days of the date of 

preliminary selection of the certified 

IDR entity. The Departments also 

propose that the non-initiating party 

must pay the administrative fee within 

2 business days of notice of an 

eligibility determination by either the 

certified IDR entity or the Departments, 

as applicable. Third, the Departments 

propose to collect the administrative fee 

directly from the disputing parties. 

Fourth, the Departments propose to 

clarify how the Federal IDR process 

applies when either party fails to timely 

pay the fees associated with the Federal 

IDR process. Finally, the Departments 

propose to charge the disputing parties 

a reduced administrative fee for lowdollar disputes and to charge the noninitiating party a reduced administrative 

fee when either the certified IDR entity 

or the Departments determine the 

dispute is not eligible for the Federal 

IDR process. 


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195 In the first full year of Federal IDR process 

operations, approximately 37 percent of disputes 

were determined ineligible for the Federal IDR 

process. See U.S. Department of Health and Human 

Services, U.S. Department of Labor, and U.S. 

Department of the Treasury. Federal Independent 

Dispute Resolution Process—Status Update. April 

27, 2023. https://www.cms.gov/files/document/ 

federal-idr-processstatus-update-april-2023.pdf. 

The Departments also propose to 

clarify the extenuating circumstances in 

which the time periods, other than 

under current 26 CFR 54.9816– 

8T(c)(4)(ix), 29 CFR 2590.716– 

8(c)(4)(ix), and 45 CFR 149.510(c)(4)(ix), 

may be extended. Specifically, the 

Departments propose that such 

extenuating circumstances include 

circumstances that contribute to 

systematic delays in processing disputes 

under the Federal IDR process, such as 

an unforeseen volume of disputes or 

Federal IDR portal system failures. The 

Departments also propose that when the 

Departments determine that the parties 

or certified IDR entities cannot meet 

applicable timeframes due to systemic 

delays in processing disputes, the 

Departments would post a public notice 

regarding any extension of time periods 

due to such extenuating circumstances. 

These proposed rules would also 

establish that such extenuating 

circumstances would include, for a 

specific dispute, when the Departments 

determine that the parties or certified 

IDR entity cannot meet applicable 

timeframes due to matters beyond the 

control of one or both parties or the 

certified IDR entity, or for other good 

cause. Further, the Departments propose 

that a certified IDR entity may submit a 

request for an extension due to 

extenuating circumstances to the 

Departments through the Federal IDR 

portal. 

Finally, the Departments propose 

requiring plans and issuers that are 

subject to the Federal IDR process to 

register with the Federal IDR portal and 

submit certain information to the 

Departments. Under these proposed 

rules, initial registration would be 

required to be completed by the later of 

30 business days after the effective date 

of the final rule or if plans and issuers 

begin offering coverage subject to the 

Federal IDR process after the effective 

date of the final rule, they would be 

required to complete their initial 

registration on the date the plan or 

issuer begins offering coverage subject 

to the Federal IDR process. 

The Departments have examined the 

effects of these proposed rules as 

required by Executive Order 13563 (76 

FR 3821, January 21, 2011, Improving 

Regulation and Regulatory Review); 

Executive Order 12866 (58 FR 51735, 

October 4, 1993, Regulatory Planning 

and Review); the Regulatory Flexibility 

Act (Pub. L. 96–354, enacted September 

19, 1980, Pub. L. 96–354); section 

1102(b) of the Social Security Act (42 

U.S.C. 1302(b)); section 202 of the 

Unfunded Mandates Reform Act of 1995 

(March 22, 1995, Pub. L. 104–4); and 

Executive Order 13132 (64 FR 43255, 

August 10, 1999, Federalism). 

B. Executive Orders 12866, 13563, and 

14094—Departments of Health and 

Human Services and Labor 

Executive Orders 12866, 13563, and 

14094 direct agencies to assess all costs 

and benefits of available regulatory 

alternatives and, if regulation is 

necessary, to select regulatory 

approaches that maximize net benefits 

(including potential economic, 

environmental, public health and safety 

effects, distributive impacts, and 

equity). Executive Order 14094 entitled 

‘‘Modernizing Regulatory Review’’ 

amends section 3(f)(1) of Executive 

Order 12866 (Regulatory Planning and 

Review). The amended section 3(f) of 

Executive Order 12866 defines a 

‘‘significant regulatory action’’ as an 

action that is likely to result in a rule: 

(1) having an annual effect on the 

economy of $200 million or more in any 

1 year (adjusted every 3 years by the 

Administrator of OMB’s Office of 

Information and Regulatory Affairs 

(OIRA) for changes in gross domestic 

product), or adversely affect in a 

material way the economy, a sector of 

the economy, productivity, competition, 

jobs, the environment, public health or 

safety, or State, local, territorial, or tribal 

governments or communities; (2) 

creating a serious inconsistency or 

otherwise interfering with an action 

taken or planned by another agency; (3) 

materially altering the budgetary 

impacts of entitlement grants, user fees, 

or loan programs or the rights and 

obligations of recipients thereof; or (4) 

raising legal or policy issues for which 

centralized review would meaningfully 

further the President’s priorities or the 

principles set forth in this Executive 

Order, as specifically authorized in a 

timely manner by the Administrator of 

OIRA in each case. 

A regulatory impact analysis (RIA) 

must be prepared for rules deemed 

significant under section 3(f)(1). Based 

on the Departments’ estimates, OMB’s 

OIRA has determined these rules are 

significant under section 3(f)(1). 

Therefore, the Departments have 

prepared an RIA that to the best of their 

ability presents the costs and benefits of 

these rules. OMB has reviewed these 

proposed regulations, and the 

Departments have provided the 

following assessment of their impact. 

C. Need for Regulatory Action— 

Departments of Health and Human 

Services and Labor 

As discussed in section II.B. of this 

preamble, gaps in communication 

between plans and issuers and 

providers, facilities, and providers of air 

ambulance services have resulted in 

confusion around issues such as 

whether an item or service is eligible for 

resolution in the Federal IDR process; 

how cost sharing and out-of-network 

rates must be determined (that is, 

through an All-Payer Model Agreement, 

specified State law, or Federal rules); 

how and with whom to initiate open 

negotiations; and which eligible items 

and services can be batched or bundled 

into one dispute. Additionally, a higherthan-expected number of disputes have 

been submitted to the Federal IDR 

process for resolution, with many found 

to be ineligible,195 contributing to 

inefficiencies in resolving disputes in 

the Federal IDR process. 

These proposed rules would require 

plans and issuers to use CARCs and 

RARCs, as specified in guidance issued 

by the Departments, or as required 

under any applicable, adopted 

standards and operating rules under 45 

CFR part 162, to communicate 

information related to whether a claim 

for an item or service furnished by an 

entity that does not have a direct or 

indirect contractual relationship with 

the plan or issuer for the furnishing of 

the item or service under the plan or 

coverage is subject to the provisions of 

26 CFR 54.9816 and 54.9817; 29 CFR 

2590.716 and 2590.717; or 45 CFR part 

149, subparts B, E, or F. 

The July 2021 interim final rules 

require plans and issuers to disclose the 

QPA and certain other information 

regarding the QPA for an item or service 

furnished by a provider, facility, or 

provider of air ambulance services, and 

specific information regarding the 

initiation of the Federal IDR process. 

These requirements were later amended 

by the August 2022 final rules. As 

discussed in section II.C. of this 

preamble, the Departments propose to 

amend regulations at 26 CFR 54.9816– 

6T(d), 29 CFR 2590.716–6(d), and 45 

CFR 149.140(d) to specify that plans and 

issuers must disclose the QPA and 

certain information about the QPA not 

only when the recognized amount (or 

for air ambulance services, the amount 

on which cost sharing is based) is the 

QPA but also when the recognized 

amount is the amount billed by the 

provider, facility, or provider of air 

ambulance services as these items and 


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services would also be eligible for the 

Federal IDR process (provided all other 

eligibility criteria are satisfied). 

In addition, the Departments propose 

amendments to the statement required 

to be provided by plans and issuers 

regarding the initiation of open 

negotiation and availability of the 

Federal IDR process. The Departments 

also propose amendments to the content 

of the statement to refer to providers of 

air ambulance services (as well as 

providers and facilities), and to specify 

that the open negotiation period is 

counted in business days and that a 

party wishing to initiate open 

negotiation must provide the required 

notice within 30 business days of 

receiving an initial payment or notice of 

denial of payment. Furthermore, the 

Departments propose that the statement 

must also note that the provider, 

facility, or provider of air ambulance 

services must notify the Departments, as 

applicable, to initiate open negotiations. 

To ensure payment disputes are 

directed to the correct parties, the 

Departments propose requiring plans 

and issuers to disclose the legal 

business name of the plan (if any) or 

issuer; the legal business name of the 

plan sponsor (if applicable); and the 

registration number to be assigned 

under 26 CFR 54.9816–9, 29 CFR 

2590.716–9, or 45 CFR 149.530, as 

applicable, if the plan or issuer is 

registered with the Federal IDR registry. 

As discussed in section II.D.1. of this 

preamble, interested parties generally 

report that disputing parties are not 

negotiating with each other during the 

required open negotiation period to the 

extent expected by the Departments. To 

encourage effective use of the open 

negotiation period, the Departments 

propose to require the party initiating 

open negotiations to use a standardized 

open negotiation notice form, which 

includes an enumerated list of 

information, and to send supporting 

documentation to the other party and 

the Departments to initiate the open 

negotiation period. Furthermore, the 

party in receipt of the open negotiation 

notice would be required to provide a 

response to the open negotiation notice 

to the other party and the Departments 

no later than the 15th business day of 

the 30-business-day open negotiation 

period. The Departments are of the view 

that this proposal would create more 

certainty regarding whether and when 

the initiating party began open 

negotiations by ensuring that start and 

end dates are documented in the 

Federal IDR portal. This proposal also 

may reduce the number of ineligible 

disputes initiated by requiring the 

exchange of eligibility information 

during open negotiation. 

As discussed in section II.D.2. of this 

preamble, to accelerate dispute 

processing and reduce the burden on 

certified IDR entities, the Departments 

propose to require the initiating party to 

provide an enumerated list of additional 

information in the notice of IDR 

initiation, including the claim number, 

an attestation that the item or service 

under dispute is a qualified IDR item or 

service and the basis on which the party 

believes it is so, and a statement 

describing the elements of the claim that 

serve as the basis for initiating the 

Federal IDR process. Similarly, the 

Departments propose to require the noninitiating party to provide a response to 

the notice of IDR initiation that must 

also include an enumerated list of 

information, including an agreement to 

the preferred certified IDR entity 

identified in the notice of IDR initiation 

or an alternate preferred certified IDR 

entity selection, an attestation that the 

item or service under dispute is a 

qualified IDR item or service, and for 

each item or service that the noninitiating party asserts is not a qualified 

IDR item or service, an explanation and 

documentation to support the assertion. 

The Departments are of the view that 

these additional elements would assist 

in determining if the item or service is 

a qualified IDR item or service that is 

eligible for the Federal IDR process, 

allow for a streamlined process to track 

the initiation of the Federal IDR process, 

enhance communication among the 

parties, and facilitate a more efficient 

Federal IDR process. 

As discussed in section II.E.1.a. of this 

preamble, since the implementation of 

the Federal IDR process, the 

Departments have identified potential 

areas to improve upon and provide 

additional clarity with respect to the 

process for selecting a certified IDR 

entity. In the Departments’ experience 

implementing this process, when a noninitiating party waits until the third 

business day after the date of IDR 

initiation to select an alternative 

preferred certified IDR entity, the 

initiating party lacks sufficient time to 

agree or object to the alternative 

preferred certified IDR entity. To 

provide the parties sufficient 

opportunity to agree or object to the 

alternative preferred certified IDR 

entity, the Departments propose to 

amend the process for selecting a 

certified IDR entity when the parties fail 

to jointly agree on a certified IDR entity. 

Specifically, the Departments propose 

that if the party last in receipt of either 

the notice of IDR initiation response or 

the notice of certified IDR entity 

selection received the notice on the 

third business day after the date of IDR 

initiation and did not agree to the other 

party’s alternative preferred certified 

IDR entity by the end of third business 

day after the date of IDR initiation, the 

Departments would provide the party 2 

additional business days to agree or 

object to other party’s preferred certified 

IDR entity selection. 

To provide clarity and to codify the 

process and timeframes for selecting a 

certified IDR entity, the certified IDR 

entity’s conflict-of-interest review, and 

the date the certified IDR entity 

selection is considered finally selected, 

the Departments propose to establish a 

process that includes both preliminary 

selection of the certified IDR entity and 

final selection of the certified IDR 

entity. The Departments are of the view 

that the conflict-of-interest review by 

the certified IDR entity should not cut 

into the time periods for either the 

disputing parties to submit their offers 

or for the certified IDR entity to make 

a payment determination. For this 

reason, the Departments propose 

requirements that would provide for a 

certified IDR entity conflict-of-interest 

review process that must be conducted 

before a preliminary selection of the 

certified IDR entity is considered to be 

a final selected certified IDR entity. 

Under these proposed rules, final 

selection of the certified IDR entity 

would trigger the timeframes for 

conducting an eligibility review, 

accepting offers of an out-of-network 

payment amount, and making a 

payment determination. 

As discussed in section II.E.1.b. of 

this preamble, eligibility determinations 

have proven to be complex, timeconsuming, resource-intensive, and 

often uncompensated activities that 

impede timely payment determinations. 

To support eligibility determinations 

during a period of systemic delay or 

other extenuating circumstances, the 

Departments propose to implement a 

departmental eligibility review. When 

this departmental eligibility review is in 

effect, the Departments would make 

eligibility determinations instead of the 

certified IDR entities. The Departments 

are of the view that these changes are 

necessary to ensure certified IDR 

entities are able to spend the majority of 

their time and resources on making 

payment determinations for eligible IDR 

items and services, prevent certified IDR 

entities from temporarily suspending 

their acceptance of new disputes, ensure 

participation in the Federal IDR process 

remains financially sustainable for 

certified IDR entities, and prevent 

disparate outcomes. 


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As discussed in section II.E.1.d.ii. of 

this preamble, the Departments have 

identified potential areas to improve 

upon and provide additional clarity 

with respect to the process for disputes 

to be withdrawn from the Federal IDR 

process. Currently, there is no clear 

uniform process for parties, the certified 

IDR entity, or the Departments to 

withdraw a dispute from the Federal 

IDR process. To establish a process for 

withdrawals, the Departments propose 

four conditions in which a dispute may 

be withdrawn from the Federal IDR 

process by the initiating party, the 

Departments, or the certified IDR entity 

before a payment determination is 

made. Specifically, the Departments 

propose that a dispute may be 

withdrawn from the Federal IDR process 

if: (1) the initiating party provides 

notification through the Federal IDR 

portal to the Departments and the 

certified IDR entity (if selected) that 

both parties agree to withdraw the 

dispute from the Federal IDR process, 

with signatures from authorized 

signatories for both parties; (2) the 

initiating party provides a standard 

withdrawal request notice to the 

Departments, the certified IDR entity (if 

selected), and the non-initiating party, 

and the non-initiating party notifies the 

Secretary, certified IDR entity (if 

selected), and initiating party of its 

agreement to withdraw within 5 

business days of the initiating party’s 

request (or the non-initiating party fails 

to respond within 5 business days of the 

initiating party’s request); (3) the 

certified IDR entity or the Departments 

cannot determine eligibility because 

both parties to the dispute are 

unresponsive to any requests for 

additional information to determine 

eligibility; or (4) the certified IDR entity 

cannot make a payment determination 

because both parties to the dispute have 

failed to submit an offer as described in 

section II.E.4. of this preamble. The 

Departments are of the view that these 

proposals would strike a balance 

between fairness to the disputing parties 

and efficiency of the Federal IDR 

process by generally requiring mutual 

agreement by the disputing parties to 

withdraw the dispute and providing 

that a dispute would be withdrawn in 

the event the parties are nonresponsive 

within the required timeframes. 

As discussed in section II.E.2. of this 

preamble, in response to the 

Departments’ experiences with batched 

determinations and operationalizing the 

Federal IDR process, as well as 

consideration of interested parties’ 

feedback, the Departments propose 

batching policies for the Federal IDR 

process to increase efficiency and create 

a workable framework for disputing 

parties and certified IDR entities. The 

Departments propose to implement 

batching provisions that would allow 

parties the flexibility to batch qualified 

IDR items and services (or ‘‘line items’’) 

that relate to the treatment of similar 

conditions, with necessary limitations 

to encourage efficiency. Specifically, the 

policy would allow all qualified IDR 

items and services within the following 

groupings to be batched together: (1) the 

items and services were furnished to a 

single patient during a patient 

encounter on one or more consecutive 

dates of service and billed on the same 

claim form (single patient encounter); 

(2) the items and services were 

furnished to one or more patients and 

billed under the same service code, or 

a comparable code under a different 

procedural code system; or (3) 

anesthesiology, radiology, pathology, 

and laboratory qualified IDR items and 

services were furnished under service 

codes belonging to the same Category I 

CPT code range, as specified in 

guidance by the Departments. The 

Departments are of the view that this 

approach would appropriately balance 

several objectives of the Federal IDR 

process, including: encouraging 

efficiency (including minimizing costs) 

within the Federal IDR process without 

unreasonably impeding payers’ or 

providers’ access to the Federal IDR 

process and considering relative costs 

and administrative burden; providing a 

framework to expedite processing of the 

backlog of Federal IDR disputes by 

simplifying the Federal IDR process 

while avoiding creating new operational 

complexities; and ensuring that items 

and services included in batched 

determinations have a clear organizing 

principle that makes for logical and 

consistent payment determinations 

across certified IDR entities in order to 

reduce the chance of disparate 

outcomes. The Departments also 

propose to codify the definition of a 

bundled payment arrangement, as 

currently set forth in guidance, at 

proposed 26 CFR 54.9816–3, 29 CFR 

2590.716–3, and 45 CFR 149.30. 

As discussed in section II.E.3. of this 

preamble, to implement a fair and 

efficient Federal IDR process, the 

Departments propose to amend the 

certified IDR entity and administrative 

fee provisions of the Federal IDR 

process to align financial incentives for 

disputing parties with the efforts 

associated with administering the 

Federal IDR process. The Departments 

propose to amend the provisions related 

to the time and manner of fee collection, 

such that an initiating party would be 

required to pay the non-refundable 

administrative fee within 2 business 

days of the date of preliminary selection 

of the certified IDR entity, and a noninitiating party would be required to 

pay the non-refundable administrative 

fee within 2 business days of being 

notified of an eligibility determination. 

The Departments also propose to add 

flexibility to the process by removing 

the requirement that certified IDR 

entities, rather than the Departments, 

must collect the administrative fee, and 

propose to directly collect the 

administrative fee from the parties. The 

Departments further propose to revise 

how the Federal IDR process applies 

when either party fails to timely pay the 

fees associated with the Federal IDR 

process. The Departments also propose 

charging the disputing parties a reduced 

administrative fee for low-dollar 

disputes and charging a non-initiating 

party a reduced administrative fee when 

either the certified IDR entity or the 

Departments determine the dispute is 

not eligible for the Federal IDR process. 

The Departments are of the view that 

these fee collection changes would 

ensure that disputing parties pay an 

administrative fee to participate in the 

Federal IDR process even if the dispute 

is determined to be ineligible, remove 

the operational burden from certified 

IDR entities of processing administrative 

fees and remitting them to the 

Departments, improve accessibility of 

the Federal IDR process for certain types 

of parties, more fairly allocate the costs 

associated with ineligible disputes, and 

help reduce the need for future 

increases to the administrative fee. 

As discussed in section II.E.5. of this 

preamble, the Departments are 

proposing to codify a generally 

applicable extension of time periods 

when the Departments determine that 

such extension is necessary due to 

extenuating circumstances that 

contribute to systematic delays in 

processing disputes under the Federal 

IDR process, such as a high volume of 

disputes or Federal IDR portal system 

failures. This would allow the 

Departments to extend the time periods 

under the Federal IDR process without 

requiring a case-by-case analysis of 

individual extension requests. The 

Departments are of the view that 

granting certain extensions in this 

manner would provide protection for 

parties engaged in the Federal IDR 

process from the impact of systematic 

processing delays and ensure that 

unforeseen circumstances do not 

unfairly disadvantage a party or hinder 

its ability to comply with the Federal 


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IDR process timeframes. This would 

also provide more transparency into the 

timing it would take for a dispute to be 

processed. 

As discussed in section II.F. of this 

preamble, the Departments propose 

requiring plans and issuers subject to 

the Federal IDR process to register with 

the Departments and provide general 

information on the application of the 

Federal IDR process to items or services 

covered by the plan or coverage. 

Providers, facilities, and providers of air 

ambulance services report that when 

they initiate open negotiations prior to 

initiating the Federal IDR process, it is 

often difficult to identify the plan or 

issuer with which they are seeking to 

initiate a dispute, determine the correct 

contact information for initiating open 

negotiation or a dispute, and delineate 

between different group health plans 

offered by the same plan sponsor. To 

address these issues, the Departments 

propose to make available a registry 

containing this information, which 

would help providers, facilities, and 

providers of air ambulance services 

initiate open negotiations and the 

Federal IDR process with all required 

information by resolving the 

aforementioned information-sharing 

issues between parties. 

D. Summary of Impacts and Accounting 

Table—Departments of Health and 

Human Services and Labor 

The expected benefits and costs of 

these proposed rules are summarized in 

Table 6 and discussed in this section of 

the preamble. In accordance with OMB 

Circular A–4, Table 6 depicts an 

accounting statement summarizing the 

Departments’ assessment of the benefits 

and costs associated with this regulatory 

action. The Departments are unable to 

quantify all benefits and costs of these 

proposed rules but have sought, where 

possible, to describe these nonquantified impacts. The effects in Table 

6 reflect non-quantified impacts and 

estimated direct monetary costs 

resulting from the provisions of these 

proposed rules. 

BILLING CODE 6325–63–P; 4830–01–P; 4510–29–P; 

4120–01–P 


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TABLE 6: Accounting Table 

Accounting Statement 

Benefits: 

Non-Quantified: 

• Reduce wasted effort on inappropriately initiated disputes for certified IDR entities as well as 

both initiating and non-initiating parties by providing information necessary for dispute initiation in a 

centralized registry, thus minimizing: (1) open negotiations and/or disputes initiated against the wrong party; 

(2) disputes over items or services that are actually subject to a specified State law or All-Payer Model 

Agreement; and (3) incorrectly batched disputes. 

• Increase efficiency (including minimizing costs) within the Federal !DR process without 

unreasonably impeding payers' or providers' access to the Federal !DR process considering potential 

administrative burden by revising the batching policies in order to reduce the chance of disparate outcomes. 

Costs: Estimate Year Dollar Discount Rate Period Covered 

Annualized $205.01 million 2023 7 percent 2024-2028 

Monetized ($/Year) $206.83 million 2023 3 percent 2024-2028 

Quantified Costs: 

• Costs to issuers and TPAs of approximately $1,549,606 to make annual changes, beginning in 

2024, to their information technology (IT) systems to accommodate the use of CAR Cs and RARCs related to 

the No Surprises Act in accordance with guidance issued by the Departments or as required under any 

applicable adopted standards and operating rules under 45 CFR part 162. 

• Costs to issuers and TPAs of approximately $505,567 to make a one-time change in 2024 to their 

IT systems to change the currently required QPA notification to incorporate the proposed information 

described in the proposed new 26 CFR 54.9816-6T(d)(l)(v), 29 CFR 2590.716-6(d)(l)(v), and 45 CFR 

149.140(d)(l)(v). 

• Costs to providers, facilities, and providers of air ambulance services of approximately 

$22,039,500 in 2024 and $44,079,000 annually beginning in 2025 to submit additional information in the 

open negotiation notice to the Departments and the other party for an estimated 560,000 disputes entering 

open negotiations annually. 

• Costs to issuers and TPAs of approximately $22,039,500 in 2024 and $44,079,000 annually 

beginning in 2025 to create and submit open negotiation notice responses to the Departments and the other 

party for an estimated 560,000 disputes entering open negotiations annually. 

• Costs to providers, facilities, and providers of air ambulance services of approximately 

$16,529,625 in 2024 and $33,059,250 annually beginning in 2025 to submit more information through 

notices of !DR initiation to the Departments and the other party for an estimated 420,000 disputes initiated 

annually. 

• Costs to issuers and TPAs of approximately $16,529,623 in 2024 and $33,059,250 annually 

beginning in 2025 to submit notice of !DR initiation responses to the Departments and the other party for an 

estimated 420,000 disputes initiated annually. 

• Costs to the Departments of approximately $11,000,000 for a one-time system build in the 

Federal IDR portal in 2024 to operationalize the proposals in these rules related to submission and exchange 

of open negotiation, initiation, and certified IDR entity selection notices and information between parties, 

and the departmental eligibility review. 

• Increase in costs of $418,621 annually beginning in 2025 for plans, issuers, providers, and 

facilities to submit the notice of certified IDR entity selection form. 

• If the departmental eligibility review is in effect, ongoing operations and maintenance costs of 

$463,320 annually beginning in 2025. 

• If the departmental eligibility review is in effect, costs to the Departments of approximately 

$17,199,000 in 2024 and $41,277,600 per year beginning in 2025 for regulatory analysis, outreach, quality 

assurance, administrative activities, and close coordination among multiple parties related to making 

eligibility determinations. 

• Costs to initiating parties of approximately $372,120 in 2024 and $744,240 annually beginning 

in 2025 associated with submitting notices of withdrawal request. 

• Costs to non-initiating parties of approximately $83,076 in 2024 and $166,152 annually 

beginning in 2025 associated with submitting notices of withdrawal response. 
Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75815 

BILLING CODE 6325–63–C; 4830–01–C; 4510–29–C; 

4120–01–C 1. Benefits 

These rules seek to maximize benefits 

to providers, facilities, providers of air 

ambulance services, plans, and issuers 

and to reduce burdens on certified IDR 

entities. The Departments invite 

comment regarding the assumptions 


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• Costs to the Departments of approximately $3,000,000 for system and operations development 

related to administrative fee collection in fiscal year (FY) 2024, and ongoing operations and maintenance 

costs of approximately $2,500,000 in FY 2025, $1,250,000 in FY 2026, $1,000,000 in FY 2027, and 

$1,000,000 in FY 2028. 

• Annual reduction of $9,257 in reporting and administrative fee processing costs for certified !DR 

entities associated with collection of the administrative fee by the Departments in lieu of the certified IDR 

entities beginning in 2025. 

• Costs to the parties of approximately $36,198,000 annually beginning in 2025 associated with 

the administrative fee proposals in these proposed rules. 

• Costs to certified IDR entities of approximately $99 in 2024 and $198 annually beginning in 

2025 associated with submitting requests for extensions. 

• Costs to the Departments of approximately $3,000,000 in 2024 and $150,000 annually 

beginning in 2025 for system and operations development related to the Federal !DR registry. 

• One-time costs to issuers and TPAs in 2024 of approximately $1,575,693 to submit information 

to register for a permanent !DR registration number, and annual costs beginning in 2025 of approximately 

$94,252 to update this information in a timely manner. 

• Costs to interested parties of$3,307,080 to review and interpret these rules in 2024. 

Not Quantified: 

• The use of CAR Cs and RARCs, in accordance with guidance issued by the Departments or as 

required under any applicable adopted standards and operating rules under 45 CFR part 162, would 

potentially reduce costs to certified IDR entities by reducing the number of ineligible payment disputes 

submitted to the Federal IDR process, and would also potentially reduce administrative costs incurred by 

parties related to initiating and responding to ineligible payment disputes. 

• If the departmental eligibility review is in effect, the Departments would be making eligibility 

determinations for disputes that are ineligible for the Federal !DR process, which would incur a higher level 

of burden than if the departmental eligibility review is not in effect. 

• The broader batching rules would increase the costs to the Departments in 2024 to implement the 

necessarv system updates. 

Intermediate effects, leading to benefits and costs: 

• Provide standardized information, via CARCs and RARCs, to providers, facilities, and providers 

of air ambulance services to increase their understanding of whether and how the No Surprises Act applies to 

claims for out-of-network items and services and determine whether disputes are eligible for the Federal IDR 

process or are subject to a specified State law or an All-Payer Model Agreement that determines the out-ofnetwork payment amount. 

• Improve information sharing among the disputing parties and the Departments and create 

increased certainty regarding when open negotiations and Federal !DR process initiation begin by: (1) 

requiring a disputing party to provide an open negotiation notice and supporting documentation to the other 

party and the Departments to initiate the open negotiation period; (2) requiring a response from the party in 

receipt of the open negotiation notice; and (3) requiring the non-initiating party to furnish a response to the 

notice ofIDR initiation. 

• Increase access to the Federal IDR process and increase equity across the parties using the 

Federal IDRprocess, regardless of eligibility, by requiring payment of the administrative fee by the initiating 

party within 2 business days of the date of preliminary selection of the certified IDR entity and by the noninitiating party within 2 business days of notice of an eligibility determination. 

• Streamline the process and increase transparency by clarifying how the Federal !DR process 

applies when either party fails to timely pay the fees associated with the Federal IDR process. 

• Improve accessibility to the Federal IDR process for some disputing parties by reducing the 

administrative fee for low-dollar disputes. 

• Provide a framework to expedite processing of the backlog of Federal IDR disputes by 

simplifying the Federal IDR process, and ensure items and services included in batched determinations have 

a clear organizing principle that makes for logical and consistent payment determinations across certified 

!DR entities by revising the batching policies in order to reduce the chance of disparate outcomes. 

• Reduction in the number of ineligible disputes by approximately 50 to 75 percent due to the 

provisions in these proposed rules. 
75816 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

made in this section and any additional 

benefits that would be associated with 

the proposals in these rules. The 

Departments also seek comment from 

individuals from minority and 

underserved communities, and 

providers who serve these individuals, 

to help address the benefits that would 

be associated with these proposed rules 

related to these communities 

specifically. 

a. Use of Claim Adjustment Reason 

Codes and Remittance Advice Remark 

Codes 

The proposed new 26 CFR 54.9816– 

6A, 29 CFR 2590.716–6A, and 45 CFR 

149.100, which would require plans and 

issuers to use CARCs and RARCs to 

convey information related to the No 

Surprises Act as specified in guidance 

issued by the Departments or as 

required under any applicable adopted 

standards and operating rules under 45 

CFR part 162, on electronic and paper 

remittance advice, would help to ensure 

plans and issuers provide information to 

providers, facilities, and providers of air 

ambulance services in a standardized 

manner and in standardized language so 

that they may understand whether and 

how the No Surprises Act applies to 

claims for out-of-network items and 

services and determine whether 

disputes are eligible for the Federal IDR 

process or subject to a specified State 

law or All-Payer Model Agreement for 

purposes of determining the out-ofnetwork rate. Additionally, the use of 

CARCs and RARCs would further 

reduce the potential for the 

communication issues discussed in 

section II.B. of this preamble, and would 

help providers, facilities, and providers 

of air ambulance services identify items 

and services that are not subject to the 

No Surprises Act’s balance billing 

protections and thus identify items and 

services that are not eligible for the 

Federal IDR process. 

By ensuring that a plan or issuer 

communicates information related to 

whether a claim for an item or service 

furnished by an entity that does not 

have a direct or indirect contractual 

relationship with the plan or issuer for 

the furnishing of the item or service 

under the plan or coverage is subject to 

the prohibitions on balance billing in 

the No Surprises Act, the proposed 

CARC and RARC requirements would 

reduce the number of ineligible 

payment disputes submitted to the 

Federal IDR process, as further 

described in section V.D.1.l. of this 

preamble. The potential reduction in 

ineligible Federal IDR disputes could 

result in faster payment determinations, 

which in turn would result in providers, 

facilities, and providers of air 

ambulance services receiving 

reimbursements sooner. 

b. Information To Be Shared About the 

QPA (26 CFR 54.9816–6T, 29 CFR 

2590.716–6, and 45 CFR 149.140) 

These proposed rules would revise 26 

CFR 54.9816–6T(d), 29 CFR 2590.716– 

6(d), and 45 CFR 149.140(d) to specify 

that plans and issuers must disclose the 

QPA and certain information about the 

QPA when cost sharing is calculated 

using the QPA or the billed amount 

(including for air ambulance services, 

for which the term ‘‘recognized 

amount’’ is inapplicable). These 

proposed revisions would provide 

greater clarity regarding when these 

disclosures must be provided. 

Further, the proposed amendments at 

26 CFR 54.9816–6, 29 CFR 2590.716–6, 

and 45 CFR 149.140 would require 

plans and issuers to disclose the legal 

business name (if any) of the plan or 

issuer; the legal business name of the 

plan sponsor (if applicable); the 

registration number assigned under 26 

CFR 54.9816–9, 29 CFR 2590.716–9, or 

45 CFR 149.530, as applicable, if the 

plan or issuer is registered with the 

Federal IDR registry. The proposed 

amendments would help ensure that 

payment disputes are directed to the 

appropriate parties, facilitate more 

productive open negotiations, and 

reduce the number of ineligible disputes 

ultimately submitted to the Federal IDR 

process (as further described in section 

V.D.1.l. of this preamble). Additionally, 

the required disclosure of the legal 

business name (if any) of the plan or 

issuer, the legal business name of the 

plan sponsor (if applicable), and the 

registration number would help 

providers, facilities, and providers of air 

ambulance services look up plans, plan 

sponsors, and issuers in the Federal IDR 

registry that would be established under 

these proposed rules. 

c. Open Negotiation 

The Departments propose to amend 

the open negotiation provisions at 26 

CFR 54.9816–8(b)(1), 29 CFR 2590.716– 

8(b)(1), and 45 CFR 149.510(b)(1) to 

require the party initiating open 

negotiations to provide an open 

negotiation notice and supporting 

documentation to the other party and 

the Departments through the Federal 

IDR portal to initiate the open 

negotiation period. The Departments 

also propose to expand the required 

information on the open negotiation 

notice to include new elements. 

Furthermore, the Departments propose 

that the party in receipt of the open 

negotiation notice would be required to 

provide a response to the open 

negotiation notice and supporting 

documentation to the other party and 

the Departments no later than the 15th 

business day of the 30-business-day 

open negotiation period. Both of these 

notice provisions require the parties to 

provide specific information detailed in 

the proposed regulatory text. 

The Departments propose these 

changes to improve information sharing 

among the parties and the Departments. 

The Departments are of the view that 

this proposal would create more 

certainty regarding whether and when a 

party began open negotiations by 

recording start and end dates. 

Furthermore, this proposal may allow 

the parties to focus negotiations on 

items or services they believe would 

ultimately be eligible for the Federal 

IDR process. This proposal would also 

create an additional exchange of 

eligibility-related disclosures between 

the parties that may reduce the number 

of ineligible disputes submitted to the 

Federal IDR process, as further 

described in section V.D.1.l. of this 

preamble. While the Departments have 

issued guidance to clarify that the use 

of an issuer’s proprietary open 

negotiation portal is not required by the 

parties, many issuers currently maintain 

their own open negotiation portals and 

encourage parties to submit notices 

through them. This proposal would 

benefit providers, facilities, and 

providers of air ambulance services by 

creating a centralized location in which 

they can exchange information for open 

negotiation, as opposed to using 

different portals and systems depending 

on the plan or issuer. These proposed 

requirements would reduce the number 

of platforms or vehicles the party 

submitting the open negotiation notice 

currently use to furnish the notices and 

supporting documentation to both the 

Departments and the other party. 

d. Initiating the Federal IDR Process and 

Notice of IDR Initiation 

The Departments propose changes to 

26 CFR 54.9816–8(b)(2), 29 CFR 

2590.716–8(b)(2), and 45 CFR 

149.510(b)(2). Specifically, the 

Departments propose to require the 

initiating party to provide additional 

elements on the notice of IDR initiation, 

including expanded information to 

identify the disputing parties (as well as 

any third party representing a party) and 

additional information to identify the 

item or service subject to the dispute. 

Similarly, the Departments propose to 

require the non-initiating party to 

provide a response to the notice of IDR 

initiation that must include an 

enumerated list of information with 


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additional disclosures, such as either a 

statement agreeing to the preferred 

certified IDR entity or an alternative 

preferred certified IDR entity, and an 

attestation as to the eligibility of the 

item or service that is the subject of the 

dispute. The Departments are of the 

view that these additional elements 

would assist in determining whether the 

item or services is eligible for the 

Federal IDR process, allow for a 

streamlined process to track dispute 

initiation, enhance communication 

among the parties, and facilitate a more 

efficient process of IDR initiation. 

Information about why the noninitiating party believes the dispute is 

ineligible for the Federal IDR process 

would assist the Departments or the 

certified IDR entity in its review of 

dispute eligibility, thereby streamlining 

the eligibility review process. 

Additionally, by streamlining the 

submission of these notices through the 

Federal IDR portal, including the open 

negotiation notice and open negotiation 

response notice, the Departments may 

be able to use information that was 

submitted for one notice to pre-populate 

subsequent notices, reducing the burden 

of providing duplicative information. 

For instance, if a party that submitted 

the open negotiation notice through the 

Federal IDR portal decides to initiate the 

Federal IDR process after the open 

negotiation period has ended, the 

Departments anticipate that the Federal 

IDR portal may be able to pre-populate 

the fields in the notice of IDR initiation 

with the same information that was 

provided in the open negotiation notice. 

Furthermore, these proposed 

requirements would reduce the number 

of platforms or vehicles the initiating 

party must use in order to furnish the 

notice of IDR initiation and supporting 

documentation to both the Departments 

and the other party. This administrative 

streamlining would simplify the burden 

on initiating parties and would create 

greater efficiency. 

e. Certified IDR Entity Selection 

The Departments propose amending 

26 CFR 54.9816–8(c)(1), 29 CFR 

2590.716–8(c)(1), and 45 CFR 

149.510(c)(1) regarding the process for 

certified IDR entity selection and 

submission of the notice of certified IDR 

entity selection. In the Departments’ 

experience implementing the Federal 

IDR process, when a non-initiating party 

waits until the third business day after 

the date of IDR initiation to select an 

alternative preferred certified IDR 

entity, the initiating party lacks 

sufficient time to agree or object to the 

alternative preferred certified IDR 

entity. To provide the parties sufficient 

opportunity to agree or object to an 

alternative preferred certified IDR 

entity, the Departments propose that if 

the party last in receipt of either the 

notice of IDR initiation response or the 

notice of certified IDR entity selection 

received the notice on the third business 

day after the date of IDR initiation and 

did not agree to the other party’s 

alternative preferred certified IDR entity 

by the end of third business day after 

the date of IDR initiation, the 

Departments would provide the party 2 

additional business days to agree or 

object to other party’s alternative 

preferred certified IDR entity selection. 

Further, to provide clarity and to codify 

the process and timeframes for selecting 

a certified IDR entity, the certified IDR 

entity’s conflict-of-interest review, and 

the date the certified IDR entity 

selection is considered finally selected, 

the Departments propose to establish a 

process that includes both preliminary 

selection of the certified IDR entity and 

final selection of the certified IDR 

entity. The Departments are of the view 

that the conflict-of-interest review by 

the certified IDR entity should not cut 

into the time periods for either the 

disputing parties to submit their offers 

or for the certified IDR entity to make 

a payment determination. For this 

reason, the Departments propose 

requirements that would provide for a 

certified IDR entity conflict-of-interest 

review process that must be conducted 

before a preliminary selection of the 

certified IDR entity is considered a final 

selected certified IDR entity. Under 

these proposed rules, the final selection 

of the certified IDR entity would trigger 

the timeframes for conducting an 

eligibility review, accepting offers of an 

out-of-network payment amount, and 

making a payment determination. The 

Departments are of the view that this 

proposal would streamline the exchange 

of information between parties, provide 

clarity on the dates that trigger the 

timeframes for offer submission and 

payment determinations, and relieve the 

time constraints on certified IDR entities 

by not having the conflict-of-interest 

review cut into the timeframe for 

payment determinations. 

f. Federal IDR Process Eligibility 

Determinations 

The Departments propose amending 

26 CFR 54.9816–8(c), 29 CFR 2590.716– 

8(c), and 45 CFR 149.510(c) to make 

Federal IDR process eligibility 

determinations the responsibility of the 

Departments in certain circumstances. 

Under this proposal, when certain 

criteria are met as discussed in section 

II.E.1.b. of this preamble, the 

Departments would determine whether 

the dispute is eligible and make the 

eligibility determination for the Federal 

IDR process (that is, departmental 

eligibility review). If the dispute is 

found to be eligible, the Departments 

would send it to the certified IDR entity 

to continue the Federal IDR process. If 

the dispute is found to be ineligible for 

the Federal IDR process, it would be 

closed. 

When the Departments are conducting 

eligibility determinations, it would 

relieve the burden on certified IDR 

entities of this responsibility and help 

ensure that they can focus their time 

and resources on payment 

determinations in accordance with 

statutory timeframes. 

g. Withdrawals 

The Departments propose to add 26 

CFR 54.9816–8(c)(3)(ii), 29 CFR 

2590.716–8(c)(3)(ii), and 45 CFR 

149.510(c)(3)(ii) to establish a process 

for disputes to be withdrawn from the 

Federal IDR process. First, these 

proposed rules would allow a dispute to 

be withdrawn from the Federal IDR 

process if the initiating party provides 

notification through the Federal IDR 

portal to the Departments and the 

certified IDR entity (if selected) that 

both parties agree to withdraw the 

dispute, with signatures from 

authorized signatories for both parties. 

These proposed rules would also 

establish that the initiating party could 

withdraw a dispute by submitting a 

standard withdrawal request notice to 

the Departments, the non-initiating 

party, and the certified IDR entity (if 

selected) through the Federal IDR portal. 

In this case, the non-initiating party 

would then be required to provide the 

standard withdrawal request response 

notice within 5 business days indicating 

agreement or objection to the request for 

withdrawal. If the non-initiating party 

fails to respond within 5 business days 

of the initiating party’s request, the noninitiating party would be considered to 

have agreed to the dispute’s withdrawal. 

The Departments also propose to 

establish that the certified IDR entity or 

the Departments could withdraw a 

dispute from the Federal IDR process if 

the certified IDR entity or the 

Departments cannot determine 

eligibility because both parties are 

unresponsive to any requests for 

additional information to determine 

eligibility, or if the certified IDR entity 

cannot make a payment determination 

because both parties have failed to 

submit an offer as described in 26 CFR 

54.9816–8(c)(5)(i), 29 CFR 2590.716– 

8(c)(5)(i), and 45 CFR 149.510(c)(5)(i). 

The Departments are of the view that 

these proposals would both create 


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196OMB Control Number: 1210–0169 (No 

Surprises Act: IDR Process). The burden is 

estimated as follows: (18 hours × $39.56) = $712.08 

per certified IDR entity. A labor rate of $39.56 is 

used for a clerical worker. The labor rates are 

applied in the following calculation: (13 × 18 hours 

× $39.56) = $9,257. 

fairness to the disputing parties and 

encourage efficiency of the Federal IDR 

process by generally requiring mutual 

agreement by the disputing parties to 

withdraw the dispute and providing 

that the dispute would be withdrawn in 

the event the parties are nonresponsive 

within the required timeframes. The 

Departments also are of the view that 

permitting the withdrawal of a dispute 

in such cases would decrease the 

number of payment determinations the 

certified IDR entity is required to 

adjudicate, improving efficiency of the 

Federal IDR process. 

h. Treatment of Batched Items and 

Services 

The Departments propose to amend 

the batching polices in response to the 

Departments’ experiences with batched 

determinations and operationalizing the 

Federal IDR process, as well as 

consideration of interested parties’ 

feedback regarding the Federal IDR 

process. Under this proposal, the 

Departments would allow parties the 

flexibility to batch qualified IDR items 

and services (or ‘‘line items’’) that relate 

to the treatment of similar conditions 

with necessary limitations to encourage 

efficiency. Specifically, the policy 

would allow all qualified IDR items and 

services to be batched by: (1) items and 

services furnished to a single patient 

during a patient encounter on one or 

more consecutive dates of service and 

billed on the same claim form (single 

patient encounter); (2) items and 

services were furnished to one or more 

patients and billed under the same 

service code, or a comparable code 

under a different procedural code 

system; or (3) anesthesiology, radiology, 

pathology, and laboratory IDR items and 

services furnished under service codes 

belonging to the same Category I CPT 

code range, as specified in guidance by 

the Departments, in order to address the 

unique circumstances of certain medical 

specialties and provider types. 

As discussed in section II.E.2. of this 

preamble, the Departments are of the 

view this approach would encourage 

efficiency (including minimizing costs) 

within the Federal IDR process without 

unreasonably impeding payers’ or 

providers’ access to the Federal IDR 

process considering relative costs and 

administrative burden; provide a 

framework to expedite processing of the 

backlog of Federal IDR disputes by 

simplifying the Federal IDR process; 

and ensure that items and services 

included in batched determinations 

have a clear organizing principle that 

makes for logical and consistent 

payment determinations across certified 

IDR entities to reduce the chance of 

disparate outcomes. 

i. Administrative and Certified IDR 

Entity Fee Collection 

i. Establishment of the Administrative 

Fee Amount and Methodology 

First, the Departments propose 

revisions to the methodology for setting 

the administrative fee and propose new 

reduced administrative fee amounts. 

The revised methodology and amounts 

would account for the proposals in 

these proposed rules, such as the 

reduced administrative fees for 

ineligible disputes and low-dollar 

disputes discussed in sections II.E.3.e. 

and II.E.3.f. of this preamble, while still 

complying with the statutory 

requirement that the Departments set 

the administrative fee amount such that 

the total amount of fees paid for such 

year is estimated to be equal to the 

amount of expenditures estimated to be 

made by the Departments for such year 

in carrying out the Federal IDR process. 

These proposals would allow the 

Departments to administer the Federal 

IDR process and be responsive to the 

needs of the program by updating the 

methodology and administrative fee 

amounts in conjunction with policy and 

operational improvements to the 

process. 

ii. Time of Collection of Administrative 

Fee and Certified IDR Entity Fee 

Second, the Departments are 

proposing to amend the provisions 

related to the time of administrative fee 

collection such that an initiating party 

would be required to pay the nonrefundable administrative fee within 2 

business days of the date of preliminary 

selection of the certified IDR entity, 

which occurs before an eligibility 

determination is complete, and the noninitiating party would be required to 

pay the non-refundable administrative 

fee within 2 business days of the noninitiating party receiving notice of an 

eligibility determination. Specifically, 

an initiating party would be expected to 

pay the administrative fee regardless of 

whether the dispute is determined 

eligible for the Federal IDR process. 

Because the administrative fees are 

currently non-refundable and under the 

current regulation and associated 

impact analysis, this benefit is 

unchanged. The Departments are of the 

view that the effect of this change in 

benefits experienced as a result of this 

proposal on disputing parties would be 

minimal. 

Overall, the Departments are of the 

view that this proposal would promote 

the objective of costs of using the 

Federal IDR process being 

proportionately borne by parties to both 

eligible and ineligible disputes. 

iii. Manner of Administrative Fee 

Collection 

Third, the Departments are proposing 

to directly collect the administrative fee 

from each party. Because the 

administrative fees are always nonrefundable, the Departments are of the 

view that the impact of this proposed 

change would be minimal. The 

Departments anticipate that direct 

collection of the administrative fee by 

the Departments would reduce the 

burden on certified IDR entities, as it 

would remove the requirement that 

certified IDR entities collect this fee and 

later remit it to the Departments upon 

dispute closure. This burden is 

currently approved under OMB control 

number 1210–0169 and accounts for an 

average of 18 hours of clerical worker 

time annually per certified IDR entity, 

as discussed further in section V.F.7. of 

this preamble.196 If this policy is 

finalized, the Departments anticipate 

this change would have minimal impact 

on the certified IDR entities, as certified 

IDR entities would continue to collect 

certified IDR entity fees from disputing 

parties. 

iv. Application of Federal IDR Process 

Requirements in Circumstances 

Involving a Failure To Pay Certified IDR 

Entity Fees or Administrative Fees 

Fourth, the Departments propose to 

clarify how the Federal IDR process 

applies when either party fails to timely 

pay the fees associated with the Federal 

IDR process. Specifically, the failure to 

pay the administrative fee by an 

initiating party would result in the 

closure of the dispute due to 

nonpayment, and failure to pay the 

certified IDR entity fee by an initiating 

party would result in the certified IDR 

entity not considering the initiating 

party’s offer. Nonpayment of the 

certified IDR entity fee or administrative 

fee by a non-initiating party would 

result in the certified IDR entity not 

considering the non-initiating party’s 

offer. The Departments are of the view 

that the impact of this change would be 

minimal. The purpose of this policy is 

to codify the sub-regulatory guidance 

that already exists and allow the closure 

of disputes in which the initiating party 


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Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75819 

197Based on data from the NAICS Association for 

NAICS code 62111 (Offices of Physicians), the 

Departments estimate the percent of businesses 

within the industry of Offices of Physicians with 

less than $16 million in annual sales. By this 

standard, the Departments estimate that 47.2 

percent or 66,207 physicians are considered small 

under the SBA’s size standards. See https://

www.census.gov/data/tables/2017/econ/susb/2017- 

susb-annual.html. 

does not provide the appropriate 

administrative fee payment. 

v. Administrative Fee Structure for 

Disputing Parties in Low-Dollar 

Disputes 

Fifth, the Departments propose to 

charge both parties a reduced 

administrative fee when the initiating 

party attests that the highest offer (or 

aggregate offers for a dispute, whether 

the dispute is for one item or service, a 

bundled arrangement, or multiple items 

and services submitted as part of a 

batched dispute) made during open 

negotiation by either disputing party 

was less than the predetermined 

threshold. Because a reduction to the 

administrative fee would only be made 

in these limited situations, the 

Departments are of the view that the 

impact of this change would be minimal 

for most parties, particularly if the value 

of disputes increases as intended under 

the batching policies proposed in these 

rules, if finalized. 

Furthermore, the Departments are of 

the view that this proposal would have 

a positive impact on some initiating 

parties, particularly small providers or 

providers in rural areas, that may not be 

able to efficiently access the Federal IDR 

process even under the batching 

policies proposed in these rules. Even 

though the Departments estimate in the 

Regulatory Flexibility Act analysis later 

in these proposed rules that there are 

approximately 66,000 small 

physicians 197 that may access the 

Federal IDR process, the Departments 

lack the data or ability to estimate how 

many providers would actually initiate 

the Federal IDR process and how many 

would or would not be able to 

efficiently initiate the process under the 

proposed batching policies in these 

rules and would therefore be impacted 

by the proposed reduced administrative 

fee for low-dollar disputes. The 

Departments seek comment on data 

sources or other resources to 

quantitatively estimate the benefits to 

this population and how to estimate the 

proportion of disputes that would be 

impacted by this policy. 

vi. Administrative Fee Structure for 

Non-Initiating Parties in Ineligible 

Disputes 

The Departments propose to charge 

the non-initiating party a reduced 

administrative fee when either the 

certified IDR entity or the Departments 

determine the entire dispute is not 

eligible for the Federal IDR process. 

Because a reduction to the 

administrative fee would be made only 

in this limited situation and one other 

situation (for low-dollar disputes), the 

Departments are of the view that the 

impact of this change would be 

minimal, particularly if the volume of 

ineligible disputes is reduced as 

anticipated due to the other policies 

proposed in these rules. The 

Departments are of the view that system 

improvements coupled with a reduced 

administrative fee in ineligible disputes 

may incentivize non-initiating parties to 

proactively raise and provide 

documentation to support eligibility 

challenges earlier in open negotiation or 

the Federal IDR process. This may result 

in a reduction in the volume of 

ineligible disputes (as further described 

in section V.D.1.l. of this preamble) and 

therefore reduce program administrative 

costs for the Departments overall. The 

Departments seek comment on the 

impact of a reduced administrative fee 

for non-initiating parties in ineligible 

disputes, including whether bad faith 

challenges to dispute eligibility may 

increase burden and whether 

modifications to the guidance for 

disputing parties are needed to prevent 

bad faith challenges to dispute 

eligibility. 

j. Extension of Time Periods for 

Extenuating Circumstances 

The Departments are proposing to 

amend 26 CFR 54.9816–8(g), 29 CFR 

2590.716–8(g), and 45 CFR 149.510(g) to 

establish at paragraph (g)(1)(i) that the 

Departments, or at the request of a 

certified IDR entity or a party, would 

determine whether an extension is 

necessary because the parties or 

certified IDR entity cannot meet 

applicable timeframes due to matters 

beyond the control of the certified IDR 

entity or one or both parties, or for other 

good cause. Under these proposed rules, 

the Departments would provide an 

extension of the time periods if they 

identify unforeseen or good cause 

delays on a case-by-case basis, as 

opposed to solely relying on one of the 

parties to submit an extension request. 

The Departments may detect these 

issues before either party would, and 

could immediately grant the necessary 

extension without having to wait for the 

submission of a formal request. 

The Departments also propose to 

establish at 26 CFR 54.9816–8(g)(1)(ii), 

29 CFR 2590.716–8(g)(1)(ii), and 45 CFR 

149.510(g)(1)(ii) to codify a generally 

applicable extension of time periods 

when the Departments determine that 

such extension is necessary due to 

extenuating circumstances that 

contribute to systematic delays in 

processing disputes under the Federal 

IDR process, such as a high volume of 

disputes or Federal IDR portal system 

failures. The Departments would also 

post a public notice about any generally 

applicable extensions of time periods. 

Under these proposed changes, the 

Departments would extend the time 

periods under the Federal IDR process 

without requiring a case-by-case 

analysis of individual extension 

requests. The Departments are of the 

view that granting certain extensions in 

this manner would provide protection 

for parties engaged in the Federal IDR 

process from the impact of systematic 

processing delays and ensure that 

unforeseen circumstances do not 

unfairly disadvantage a party or hinder 

its ability to comply with the Federal 

IDR process timeframes. This would 

also provide more transparency into the 

time it would take for a dispute to be 

processed. 

k. Registration of Group Health Plans 

and Health Insurance Issuers 

Access to the IDR registry would 

provide a single, centralized place for 

initiating parties to find contact 

information for a plan or issuer, 

therefore reducing time spent by 

providers, facilities, and providers of air 

ambulance services when they initiate 

open negotiations. The registry would 

also help reduce wasted effort on 

inappropriately initiated disputes for 

certified IDR entities, as well as both 

initiating and non-initiating parties, by 

minimizing: (1) disputes initiated 

against the wrong party; (2) disputes 

over items or services that are subject to 

a specified State law or All-Payer Model 

Agreement; and (3) disputes that are 

incorrectly batched. 

l. Reduction in Ineligible Disputes 

The Departments anticipate that 

provisions of these proposed rules, in 

particular the proposed use of RARCs 

and CARCs, the proposed requirements 

in the open negotiation notice and 

response and the IDR initiation notice 

and response, the proposed 

modifications to batching requirements, 

the proposal to require the initiating 

party to pay the non-refundable 

administrative fee earlier in the 


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75820 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

198This requirement would not apply to claims 

submitted by a participant, beneficiary, or enrollee 

directly to the plan or issuer for items or services 

furnished by a nonparticipating provider or 

nonparticipating facility. 

199Based on data from MLR annual report for the 

2021 MLR reporting year. See https://www.cms.gov/ 

CCIIO/Resources/Data-Resources/mlr. 

200Non-issuer TPAs based on data derived from 

the 2016 benefit year reinsurance program 

contributions. 

201Wage rate derived from the BLS May 2022 

National Occupational Employment and Wage 

Estimates for Computer Programmer (occupation 

15–1251). Mean hourly rate ($49.42) has been 

increased by 100 percent to account for the cost of 

fringe benefits and other indirect costs ($49.42 * 

100% = $98.84). 

initiation process, and the proposed 

registry for group health plans and 

health insurance issuers, would reduce 

the number of ineligible disputes 

initiated in the Federal IDR process each 

year. Preliminary internal data indicate 

that between June 2022 and May 2023, 

approximately 48,000 disputes were 

determined to be ineligible by certified 

IDR entities. Based on this data and the 

rates of ineligibility attributable to 

various reasons (for example, State 

jurisdiction over the dispute or the 

dispute being initiated against the 

wrong non-initiating party), the 

Departments estimate that a total 

decrease in ineligible disputes of 

approximately 50 to 75 percent, or 

24,000 to 36,000 disputes, could result 

from the cumulative impact of these 

proposals each year. The Departments 

have calculated this estimated range to 

reflect that the proposals in these rules, 

while severable, may work in concert 

with one another to reduce ineligible 

disputes. Uncertainties in the reduction 

of ineligible disputes remain, and the 

Departments note that variables such as 

the number of disputes initiated have 

changed over time and may continue to 

fluctuate. Therefore, it is possible that 

the number of ineligible disputes 

ultimately prevented by the proposals in 

these rules could be outside of the range 

estimated in this paragraph. 

2. Costs 

These proposed rules seek to 

minimize costs to providers, facilities, 

providers of air ambulance services, 

plans, and issuers. The Departments 

seek comments on the assumptions 

made in this section and any additional 

costs that would be incurred by affected 

parties associated with the proposals in 

these proposed rules. The Departments 

also seek comment from individuals 

from minority and underserved 

communities, and providers who serve 

these individuals, to help address the 

costs that would be associated with 

these proposed rules related to these 

communities specifically. 

a. Required Use of CARCs and RARCs 

Plans and issuers would incur costs to 

comply with the requirements of these 

proposed rules related to the use of 

CARCs and RARCs. Plans and issuers 

would be required to use CARCs and 

RARCs on both electronic and paper 

remittance advice, in accordance with 

guidance issued by the Departments or 

as required under any applicable, 

adopted standards and operating rules 

under 45 CFR part 162. This would be 

necessary when processing out-ofnetwork claims 198 to communicate 

information related to whether a claim 

for an item or service furnished by an 

entity that does not have a direct or 

indirect contractual relationship with 

the plan or issuer for the furnishing of 

the item or service under the plan or 

coverage is subject to the No Surprises 

Act’s surprise billing provisions. 

The Departments estimate that 1,500 

issuers 199 and 205 TPAs 200 would 

incur costs to automate the process to 

include the appropriate CARCs and 

RARCs in the appropriate remittance 

documents and comply with the 

proposed provisions. The Departments 

anticipate that issuers and TPAs would 

need to make annual changes to their IT 

systems to accommodate additional No 

Surprises Act-related CARCs and 

RARCs that may be required by the 

Departments in future guidance, or as 

required under any applicable adopted 

standards and operating rules under 45 

CFR part 162. The Departments estimate 

that each issuer or TPA would require 

a computer programmer 8 hours (at an 

hourly rate of $98.84) 201 to make annual 

changes to their IT system to allow for 

the incorporation of newly developed 

No Surprises Act-related CARCs and 

RARCs into their remittance documents 

and an operations manager 1 hour (at an 

hourly rate of $118.14) to annually 

verify accuracy and accessibility. The 

Departments estimate that each issuer or 

TPA would require a total of 9 hours 

annually, with an associated cost of 

$909. For all issuers and TPAs, the 

Departments estimate an annual burden 

of 15,345 hours, with an associated total 

annual cost of $1,549,606 beginning in 

2024. 

The Departments anticipate that most 

issuers and TPAs that are subject to 

HIPAA Administrative Simplification 

requirements currently use ERA and 

therefore are already required to use 

CARCs and RARCs in their ERAs to 

providers. However, the Departments 

recognize that some plans, issuers, and 

TPAs may not have the capacity to use 

more than one CARC and RARC per line 

item or may not currently use CARCs 

and RARCs when providing paper 

remittances. These issuers and TPAs 

would incur a higher burden and cost 

associated with the proposed 

provisions, particularly to the extent 

that an issuer or TPA is required to use 

multiple CARCs and RARCs per line 

item. In addition, plans and issuers with 

narrow networks may incur increased 

costs, as they would likely process more 

out-of-network claims to which this 

proposal would apply. The Departments 

anticipate that TPAs would, in general, 

pass on the costs to implement the use 

of CARCs and RARCs to plan sponsors, 

which in turn could be passed on to 

participants in the form of higher 

premiums or contributions. 


lotter on DSK11XQN23PROD with PROPOSALS2EP03NO23.011</GPH>

TABLE 7: Annual IT Costs for Issuers and TPAs Related to CARCs and RARCs 

Estimated Number Hours per Total Annual of Issuers and Issuer/TPA (Hours) Total Estimated Cost 

TPAs (Hours) 

Annual IT Changes 1,705 9.0 15,345 $1,549,606 
Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75821 

202OMB Control Number: 1210–0169 (No 

Surprises Act: IDR Process). 

The Departments seek comment on 

these estimates, the number of issuers or 

TPAs that do not currently have the 

ability to use CARCs and RARCs on 

paper remittance documents, what the 

burden and cost would be, and if any of 

those costs would be passed on to plan 

sponsors, to meet the requirements of 

this proposed provision. The 

Departments specifically seek comment 

on whether plans and issuers generally 

have the ability to use CARCs and 

RARCs in both paper and electronic 

remittance advice, or just electronic 

remittance advice. The Departments 

recognize that an issuer’s or TPA’s 

current IT structure could play a role in 

their ability to meet the requirements in 

the proposed provisions and the ability 

to apply more than one CARC and 

RARC combination on a single line 

item, if required in certain scenarios. 

The Departments seek comment on 

issuers’ and TPAs’ capability to 

implement new No Surprises Actspecific CARCs and RARCs and to use 

more than one CARC and RARC 

combination on a single line item if 

necessary; what barriers plans, issuers, 

and TPAs may face in developing and 

implementing this capability; and what 

associated burden and cost would be 

incurred to implement and 

operationalize this capability for both 

electronic and paper remittances. 

In addition, the use of CARCs and 

RARCs on both electronic and paper 

remittance advice would potentially 

reduce costs to certified IDR entities by 

reducing the number of ineligible 

payment disputes submitted to the 

Federal IDR process, as further 

described in section V.D.1.l. of this 

preamble. It would also reduce 

administrative costs incurred by parties 

related to initiating and responding to 

ineligible payment disputes. 

b. Information To Be Shared About the 

QPA 

As detailed in section V.F.2. of this 

preamble, the Departments estimate that 

in the aggregate plans (or their TPAs) 

and issuers would incur a total one-time 

cost in 2024 of approximately $505,567 

to make changes to the currently 

required QPA notification to incorporate 

the additional information described in 

proposed amendments to paragraphs 26 

CFR 54.9816–6(d)(1)(iv) and (v), 29 CFR 

2590.716–6(d)(1)(iv) and (v), and 45 

CFR 149.140(d)(1)(iv) and (v). 

c. Open Negotiation 

The Departments propose to amend 

the open negotiation provisions to 

require the party initiating open 

negotiations to provide an open 

negotiation notice and supporting 

documentation to the other party and 

the Departments through the Federal 

IDR portal to initiate the open 

negotiation period. The Departments 

propose to expand the required 

information on the open negotiation 

notice to include new elements. 

Furthermore, the party in receipt of the 

open negotiation notice would be 

required to provide a response to the 

open negotiation notice within the first 

15 business days of 30-business-day 

open negotiation period. 

To implement this proposal and other 

proposals in these proposed rules 

impacting the submission of 

information to the Federal IDR portal 

(including the proposals pertaining to 

the notice of IDR initiation and notice 

of IDR initiation response forms, the 

notice of certified IDR entity selection 

form, and the departmental eligibility 

review), the Departments would need to 

implement system changes to the 

Federal IDR portal to ensure parties are 

able to submit the open negotiation 

notice through the portal to the other 

party and the Departments, and to allow 

for a response from the non-initiating 

party. The Departments estimate that 

their costs to implement all portal 

system changes described in these 

proposed rules would be approximately 

$11,000,000 in fiscal year 2024. While 

some plans or issuers have created their 

own proprietary portals to facilitate 

open negotiations, providers, facilities, 

and providers of air ambulance services 

are not required to use them, and the 

Departments are of the view that there 

would be significant efficiencies in 

having one central location where 

providers, facilities, and providers of air 

ambulance services could initiate open 

negotiations across all plans and issuers. 

The Departments estimate that these 

proposed rules would increase burden 

and create burden for the parties 

submitting the open negotiation notice 

and the proposed open negotiation 

response notice.202 The total burden 

associated with these new requirements 

for parties would be 420,000 hours at a 

cost of $44,079,000 in 2024 and 840,000 

hours at a cost of $88,158,000 annually 

beginning in 2025. The burden 

associated with this information 

collection is discussed further in section 

V.F.3. of this preamble. 

The Departments seek comment on 

these costs and any other burdens 

interested parties foresee resulting from 

this proposal. 

d. Initiating the Federal IDR Process and 

Notice of IDR Initiation 

The Departments are proposing 

changes impacting the process for 

initiating the Federal IDR process and 

the notice of IDR initiation. The cost 

associated with updates to the Federal 

IDR portal for IDR initiation are 

described in the previous section 

V.D.2.c. regarding open negotiation 

costs. The Departments are proposing 

these changes to accelerate dispute 

processing and reduce the burden on 

certified IDR entities. Specifically, the 

Departments propose to require the 

initiating party to provide additional 

information and supporting 

documentation on the notice of IDR 

initiation. The Departments also 

propose to require the non-initiating 

party to provide a response to the notice 

of IDR initiation within 3 business days 

of the date of IDR initiation that must 

include an enumerated list of 

information with additional disclosures, 

including a statement agreeing to the 

preferred certified IDR entity or 

providing an alternative preferred 

certified IDR entity, information 

regarding the eligibility of the item or 

service subject to the dispute, and 

supporting documentation. These 

proposals would increase the 

administrative burden for parties as they 

add information requirements that 

parties must submit at the initiation of 

the Federal IDR process. The 

Departments estimate that the total 

combined burden associated with the 

new requirements for all parties would 

be 315,000 hours at a cost of 

$33,059,250 in 2024 and 630,000 hours 

at a cost of $66,118,500 annually 

beginning in 2025. The burden 

associated with this information 

collection is discussed further in section 

V.F.4.a. of this preamble. 

e. Certified IDR Entity Selection 

The Departments propose to amend 

the process for the preliminary selection 

of the certified IDR entity and the 

submission of the notice of certified IDR 

entity selection. Specifically, under 

these proposed rules, the Departments 

propose that the non-initiating party 

must agree or object to the preferred 

certified IDR entity in the notice of IDR 

initiation response within 3 business 

days after the date of IDR initiation as 

discussed in section II.D.2.b. of this 

preamble. Due to this proposed change, 

the initiating party would only be 

required to submit the notice of certified 

IDR entity selection if the non-initiating 

party submits an alternative preferred 

certified IDR entity in the notice of IDR 

initiation response. The initiating party 


lotter on DSK11XQN23PROD with PROPOSALS2
75822 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

203Federal Independent Dispute Resolution (IDR) 

Process Administrative Fee and Certified IDR Entity 

Fee Ranges proposed rules, 88 FR 65888 (September 

26, 2023). 

would submit its notice agreeing or 

objecting to the non-initiating’s 

alternative preferred certified IDR entity 

through the Federal IDR portal. The 

non-initiating party would only be 

required to submit the notice of certified 

IDR entity selection if the initiating 

party provides an alternative preferred 

certified IDR entity in the notice of 

certified IDR entity selection within the 

3-business-day period following the 

date of IDR initiation. As such, the 

burden associated with this collection 

would be increased by approximately 

$418,621 and is described further in 

section V.F.4.b. of this preamble. 

f. Federal IDR Eligibility Determinations 

The Departments propose amending 

26 CFR 54.9816–8(c)(1)(v), 29 CFR 

2590.716–8(c)(1)(v), and 45 CFR 

149.510(c)(1)(v) to make Federal IDR 

process eligibility determinations the 

responsibility of the Departments in 

certain circumstances, at the discretion 

of the Departments. Under this proposal 

to invoke a departmental eligibility 

review when certain criteria are met as 

discussed in section II.E.1.b. of this 

preamble, following IDR initiation, the 

Departments would evaluate whether 

the dispute is eligible for the Federal 

IDR process and make an eligibility 

determination. If the dispute is found to 

be eligible, the Departments would send 

it to the certified IDR entity to continue 

the Federal IDR process. If the dispute 

is found to be ineligible for the Federal 

IDR process, it would be closed. 

By assuming the responsibility for 

Federal IDR process eligibility 

determinations, the Departments would 

incur costs that have thus far been 

incurred primarily by certified IDR 

entities. Therefore, it is important to 

note that these costs generally represent 

a transfer of costs (from certified IDR 

entities to the Departments) rather than 

actual new costs associated with the 

Federal IDR process. It is equally 

important to note that the Departments 

cannot quantify the full extent of these 

costs as they are now being incurred by 

certified IDR entities, and the 

Departments are not privy to their 

finances. As such, these estimates 

should be considered as the 

Departments’ best approximations based 

on limited information. 

These costs would vary depending on 

whether the departmental eligibility 

review for Federal IDR process 

eligibility determinations is in effect or 

not and may also vary considerably 

based on Federal IDR process dispute 

volume. When the departmental 

eligibility review is not in effect, the 

Departments would incur fewer costs, as 

they would not be responsible for 

Federal IDR process eligibility 

determinations. The Departments 

estimate that they would incur a onetime ‘‘startup’’ cost for system and 

operations development in the first year 

beginning when these proposed rules 

are finalized and go into effect, which 

is included in the cost of the overall 

Federal IDR portal build described in 

section V.D.2.c. of this preamble, and 

ongoing operations and maintenance 

costs of $463,320 annually thereafter. 

When the departmental eligibility 

review is in effect, the Departments 

would be making eligibility 

determinations for disputes submitted 

to the Federal IDR process, which 

would incur a much higher level of 

burden, including responsibilities such 

as regulatory analysis, outreach, quality 

assurance, administrative activities, and 

close coordination among multiple 

parties. The Departments estimate that 

this would cost approximately 

$17,199,000 in 2024 and $41,277,600 

per year beginning in 2025. The 

Departments wish to reiterate the draft 

nature of these estimates and their 

strong dependency on Federal IDR 

process volume, which is highly 

challenging to predict. As such, the 

Departments encourage comment and 

feedback. 

g. Withdrawals 

The Departments propose to add 26 

CFR 54.9816–8(c)(3)(ii), 29 CFR 

2590.716–8(c)(3)(ii), and 45 CFR 

149.510(c)(3)(ii) to establish a process 

for disputes to be withdrawn from the 

Federal IDR process. If the withdrawal 

is not agreed upon by both parties, these 

proposed rules would require the 

initiating party to submit a withdrawal 

request to the Departments and the noninitiating party through the Federal IDR 

portal. The non-initiating party would 

then be required to provide a response 

within 5 business days indicating 

agreement or objection to the request for 

withdrawal. If the non-initiating party 

fails to respond within 5 business days 

of the initiating party’s request, the noninitiating party would be considered to 

have agreed to the dispute’s withdrawal. 

This new collection would result in a 

cost to the parties of $455,196 in 2024 

($372,120 for initiating parties and 

$83,076 for non-initiating parties) and 

$910,392 ($744,240 for initiating parties 

and $166,152 for non-initiating parties) 

annually beginning in 2025, as 

discussed further in section V.F.6. of 

this preamble. 

h. Treatment of Batched Items and 

Services 

The Departments propose to amend 

the batching policies in response to the 

Departments’ experiences with batched 

determinations and operationalizing the 

Federal IDR process, as well as 

consideration of interested parties’ 

feedback regarding the Federal IDR 

process. Under this proposal, the 

Departments would allow parties the 

flexibility to batch qualified IDR items 

and services (or ‘‘line items’’) that relate 

to the treatment of a similar condition 

with necessary limitations to encourage 

efficiency. Specifically, the policy 

would allow all qualified IDR items and 

services to be batched by: (1) items and 

services furnished to a single patient 

during a patient encounter on one or 

more consecutive dates of service and 

billed on the same claim form (single 

patient encounter); (2) items and 

services furnished to one or more 

patients and billed under the same 

service code, or a comparable code 

under a different procedural code 

system; or (3) anesthesiology, radiology, 

pathology, and laboratory IDR items and 

services furnished under service codes 

belonging to the same Category I CPT 

code range, as specified in guidance by 

the Departments, in order to address the 

unique circumstances of certain medical 

specialties and provider types. 

To implement this proposal, the 

Departments would need to implement 

system changes to the Federal IDR 

portal to ensure that the ability to batch 

under the new rules is operationalized. 

The total cost to implement system 

changes associated with submitting 

information through the portal, 

including those related to batching, is 

described in the open negotiation cost 

section of these proposed rules (section 

V.D.2.c. of this preamble). While the 

Federal IDR portal currently has 

batching capabilities, these proposed 

rules would allow for additional 

permissible mechanisms of batching 

which would need to be collected and 

captured in the Federal IDR portal. 

i. Administrative Fee Collection 

i. Establishment of the Administrative 

Fee Amount and Methodology 

The Departments propose revisions to 

the methodology for setting the 

administrative fee and propose new 

reduced administrative fee amounts. If 

the IDR Process Fees proposed rules are 

finalized as proposed, the 

administrative fee in effect in calendar 

year 2024 would be $150 per party per 

dispute.203 Based on internal Federal 

IDR process data and estimating the 

impact of TMA IV’s vacatur of the 


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Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75823 

204This is calculated as follows: (65,520 disputes 

× 2 parties per dispute × $75 per party) + {18,480 

disputes × [(1 party per dispute × $75 per party) + 

(1 party per dispute × $30 per party)]} + {73,920 

disputes × [(1 party per dispute × $150 per party) 

+ (1 party per dispute × $30 per party)]} + (262,080 

disputes × 2 parties per dispute × $150 per party) 

= $103,698,000. 

batching regulations at 26 CFR 54.9816– 

8T(c)(3)(i)(C), 29 CFR 2590–716– 

8(c)(3)(i)(C), and 45 CFR 

149.510(c)(3)(i)(C), the Departments 

estimate that approximately 225,000 

disputes are closed per year. Therefore, 

if the administrative fee as proposed in 

the IDR Process Fees proposed rule, if 

finalized, were to remain applicable, 

disputing parties would pay 

approximately $67,500,000 in 

administrative fees annually (225,000 

disputes × 2 parties per dispute × $150 

per party). 

In these proposed rules, the 

Departments are proposing an 

administrative fee of $150 per party per 

dispute, a reduced administrative fee of 

$75 for both parties in low-dollar 

disputes, and a reduced administrative 

fee of $30 for non-initiating parties in 

ineligible disputes for disputes initiated 

on or after January 1, 2025. The 

Departments are also proposing to 

collect the administrative fee directly 

from the parties closer to the time of 

initiation rather than the time a dispute 

is closed. 

The Departments project a total of 

420,000 disputes would be initiated 

annually based on internal data, which 

includes 65,520 disputes for which both 

parties would pay the reduced 

administrative fee for low-dollar 

disputes, 18,480 disputes for which the 

initiating party would pay the reduced 

administrative fee for low-dollar 

disputes and the non-initiating party 

would pay the reduced administrative 

fee for ineligible disputes, 73,920 

disputes for which the initiating party 

would pay the full administrative fee 

and the non-initiating party would pay 

the reduced administrative fee for 

ineligible disputes, and 262,080 

disputes for which both parties would 

pay the full administrative fee. Thus, 

based on this data and assuming the 

number of disputes remains stable year 

over year and the administrative fee 

amounts are not subsequently changed 

through notice and comment 

rulemaking, the Departments estimate 

that disputing parties would pay 

approximately $103,698,000 in 

administrative fees annually beginning 

in 2025.204 Therefore, the costs 

associated with this proposal would be 

approximately $36,198,000 annually 

beginning in 2025 ($103,698,000 if this 

proposal is finalized ¥$67,500,000 if 

the baseline condition under the IDR 

Process Fees proposed rules, if 

finalized, were to continue). 

The Departments seek comment on 

these estimates and assumptions. 

ii. Time of Collection of Administrative 

Fee and Certified IDR Entity Fee 

The Departments are proposing to 

amend the provisions related to the time 

of administrative fee collection such 

that an initiating party would be 

required to pay the non-refundable 

administrative fee within 2 business 

days of the date of preliminary selection 

of the certified IDR entity, and the noninitiating party would be required to 

pay the non-refundable administrative 

fee within 2 business days after a notice 

of an eligibility determination. Because 

initiating parties are not required to pay 

the administrative fee until offer 

submission under current guidance, 

some initiating parties fail to pay this 

fee for ineligible disputes. Although the 

Departments anticipate that this 

proposal would result in all initiating 

parties paying their administrative fee 

because the administrative fees are 

always non-refundable and incurred 

when preliminary selection of the 

certified IDR entity is complete, the 

Departments are of the view that the 

impact of this proposed change would 

be minimal on initiating parties, as 

compared to the existing regulation, 

associated burden analysis, and 

approved Paperwork Reduction Act 

Supporting Statement, which provide 

for all administrative fees to be nonrefundable and to be paid in every 

dispute submitted. Under these 

proposed rules, if an initiating party 

fails to pay the required administrative 

fee within 2 business days of 

preliminary selection of the certified 

IDR entity, the dispute would be closed 

and neither disputing party would owe 

the administrative fee; thus, a dispute 

opened by an initiating party that fails 

to timely pay the administrative fee is 

treated as a provisional dispute that 

does not proceed through the full 

Federal IDR process. Further, the 

Departments anticipate that this 

proposal would result in almost all noninitiating parties paying their 

administrative fee because of associated 

penalties for nonpayment, including 

that their offer would not be considered 

received, the non-initiating party would 

still be responsible for paying the 

administrative fee, and the unpaid 

administrative fee would be subject to 

Federal debt collection procedures. 

Currently, approximately 40 percent 

of non-initiating parties do not pay the 

administrative fee. Under these 

proposed changes, the Departments 

estimate a total of 420,000 disputes 

would be initiated annually. However, 

the Departments are of the view that 

extrapolating a 40 percent cost increase 

to non-initiating parties would not be 

appropriate. Specifically, the 

combination of policies proposed in 

these rules, including attestation of 

eligibility during open negotiation and 

requiring the initiating party to pay the 

administrative fee at preliminary 

selection of the certified IDR entity, are 

designed to reduce the number of 

ineligible disputes submitted (as further 

described in section V.D.1.l. of this 

preamble), which are the disputes for 

which parties are often not paying the 

associated administrative fees. This 

proposal would be implemented in 

tandem with the requirements that noninitiating parties respond to the notice 

of IDR initiation, and the estimated 

amount of time for the non-initiating 

party to submit payment would be 

included in the estimated amount of 

time for the non-initiating party to 

submit the notice of IDR initiation 

response proposed in these rules. This 

amount of time is discussed further in 

section V.F.4.a. of this preamble. 

The Departments are of the view that, 

if these proposed rules are finalized, 

initiating parties would submit fewer 

ineligible disputes, which would 

decrease the expenses incurred by the 

Departments and certified IDR entities 

to review eligibility information. In 

addition, parties would pay the required 

administrative fees in a higher 

percentage of disputes. However, at the 

same time, there would be fewer 

disputes to review, so fewer 

administrative fees would be collected. 

Overall, the Departments are of the view 

that this proposal would ensure that the 

costs of using the Federal IDR process 

are being equitably allocated to both 

eligible and ineligible disputes. 

iii. Manner of Administrative Fee 

Collection 

The proposal for the Departments to 

directly collect the administrative fee 

from disputing parties would increase 

the activities required to be accounted 

for in the administrative fee, as the 

Departments’ costs associated with this 

collection would need to be included in 

that fee. The Departments estimate that 

there would be an implementation cost 

of approximately $3,000,000 for system 

and operations development related to 

administrative fee collection in FY 

2024, and ongoing operations and 

maintenance costs of approximately 

$2,500,000 in FY 2025, $1,250,000 in 

FY 2026, $1,000,000 in FY 2027, and 

$1,000,000 in FY 2028. Because the 

Federal IDR process is intended to be 


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self-sustaining, once the administrative 

fee calculation is adjusted, there would 

be no financial impact to the Federal 

Government. Although the Departments 

are of the view that requiring disputing 

parties to pay the administrative fee 

directly to the Departments, instead of 

to certified IDR entities, would not 

impose an additional administrative 

burden on disputing parties, the 

Departments acknowledge that any 

increased fee that could potentially 

result from this proposal could impact 

disputing parties. The Departments seek 

comment on these assumptions, 

including any burden increase 

associated with this process and 

whether that potential burden would be 

offset by a reduction of the 

administrative fee based on a higher 

collection rate of the administrative fee 

from disputing parties. 

iv. Application of Federal IDR Process 

Requirements in Circumstances 

Involving a Failure To Pay Certified IDR 

Entity Fees or Administrative Fees 

The Departments propose to clarify 

how the Federal IDR process applies 

when either party fails to timely pay the 

fees associated with the Federal IDR 

process. Specifically, the failure to pay 

the administrative fee by an initiating 

party would result in the closure of the 

dispute, and nonpayment of the 

certified IDR entity fee by the initiating 

party would result in the certified IDR 

entity not considering the initiating 

party’s offer. Nonpayment of the 

certified IDR entity or administrative fee 

by a non-initiating party would result in 

the certified IDR entity not considering 

the non-initiating party’s offer. The 

Departments are of the view that the 

impact of this change would be minimal 

for the parties, as the purpose of this 

policy is to clarify the sub-regulatory 

guidance that already exists and allow 

closure of disputes in which the 

initiating party does not provide the 

appropriate administrative fee payment. 

Further, the Departments are of the view 

that it would take a de minimis amount 

of time for the initiating and noninitiating parties to include their 

taxpayer identification numbers, which 

would be required to link debts owed by 

the disputing parties to the 

Departments, on the notice of IDR 

initiation and the notice of IDR 

initiation response. 

v. Administrative Fee Structure for 

Disputing Parties in Low-Dollar 

Disputes 

The Departments propose to charge 

the parties a reduced administrative fee 

when the initiating party attests that the 

highest offer made during open 

negotiation by either party was less than 

the predetermined threshold as 

discussed further in section II.E.3.e. of 

this preamble. Because a reduction of 

the administrative fee would be applied 

to both parties when a low-dollar 

dispute is initiated, the Departments are 

of the view that the impact of this 

change would be minimal for most 

parties when combined with the 

proposal to expand batching, because 

these policies combined would result in 

fewer single low-dollar disputes being 

initiated. Furthermore, this proposal 

would reduce costs for certain parties to 

participate in the process, namely 

parties that provide low-dollar items or 

services and are unable to batch a 

sufficient number of items and services 

together to benefit from the batching 

proposals in these rules. 

This proposal would require initiating 

parties to attest (for example, by 

checking a box) in the Federal IDR 

portal that no offer made by either party 

during open negotiation exceeded a 

predetermined threshold. The 

Departments are of the view that this 

action would only take a de minimis 

amount of time for the initiating party 

to complete, perhaps a minute, and 

therefore would result in negligible 

costs. This amount of time is minimal 

and is captured in the total time it takes 

to initiate the dispute—2.25 hours, as 

discussed further in the PRA package 

for the Federal IDR process (OMB 

control number: 1210–0169). This 

proposal may also increase the burden 

on the Federal Government due to the 

costs to complete system updates to 

account for this proposal, but the 

Departments anticipate that these costs 

would be incurred in tandem with 

changes to the other system build costs 

discussed in these proposed rules; thus, 

those costs are included in the cost 

estimates for the proposed changes 

related to open negotiation in section 

V.D.2.c. of this preamble. Furthermore, 

the Departments are of the view that the 

benefit of making the Federal IDR 

process more accessible to all types of 

providers, such as providers of lowdollar services, outweighs the limited 

costs to HHS to modify its system build. 

vi. Administrative Fee Structure for 

Non-Initiating Parties in Ineligible 

Disputes 

Additionally, the Departments 

propose to charge the non-initiating 

party a reduced administrative fee when 

either the certified IDR entity or the 

Departments determine the entire 

dispute is not eligible for the Federal 

IDR process. Because a reduction of the 

administrative fee would be applied to 

the non-initiating party when a dispute 

is ineligible for the Federal IDR process, 

the Departments are of the view that the 

impact of this change would be minimal 

for two reasons. First, under the current 

process, certified IDR entities often do 

not collect the administrative fee in 

these disputes; however, non-paying 

parties have been on notice that this fee 

was due even if they did not pay at the 

appropriate time. Second, policies such 

as requiring an attestation of eligibility 

during open negotiation and requiring 

the initiating party to pay the 

administrative fee at preliminary 

selection of the certified IDR entity are 

designed to reduce the number of 

ineligible disputes (as further described 

in section V.D.1.l. of this preamble) 

such that non-initiating parties would 

be assessed an administrative fee in 

fewer ineligible disputes. Because this 

process may incentivize non-initiating 

parties to timely challenge dispute 

eligibility during open negotiation, this 

may better capture the costs associated 

with the parties. 

Further, the burden on disputing 

parties is dependent on whether the 

administrative fee is increased or 

decreased, which is a byproduct of 

estimated total annual expenditures by 

the Departments. In the event of a 

substantial change in payment of the 

administrative fee based on the volume 

of ineligible disputes or associated 

expenditures, which would impact the 

calculation of the administrative fee, the 

parties may incur an increased or 

decreased administrative fee to cover 

the costs to carry out the Federal IDR 

process. The Departments seek 

comment on potential impacts to 

disputing parties and certified IDR 

entities of any change in burden from 

this policy, including any modifications 

to internal operating procedures that 

may be required to implement this fee 

structure. 

j. Extension of Time Periods for 

Extenuating Circumstances 

The Departments propose to establish 

that the Departments, or at the request 

of a certified IDR entity or a party, 

would determine whether an extension 

is necessary because the parties or 

certified IDR entity cannot meet 

applicable timeframes due to matters 

beyond the control of the certified IDR 

entity or one or both parties, or for other 

good cause. The process for requesting 

an extension due to extenuating 

circumstances would remain the same 

as when this process was established in 

the October 2021 interim final rules, 

and entities would continue to submit 

the Request for Extension due to 

Extenuating Circumstances form 

through the Federal IDR portal. 


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205 In the regulatory impact analysis of the 

October 2021 interim final rules, the Departments 

estimated that 17,333 disputes involving non-air 

ambulance services and 4,899 disputes involving 

air ambulance services would be submitted to the 

Federal IDR process during the first year of 

implementation, totaling 22,232 anticipated 

disputes. 

206Federal Independent Dispute Resolution 

Process—Status Update. Centers for Medicare & 

Medicaid Services. April 27, 2023. https:// 

www.cms.gov/files/document/federal-idrprocessstatus-update-april-2023.pdf. 

However, based on the proposed 

changes to this policy, the Departments 

estimate that the number of respondents 

would increase due to the addition of 

certified IDR entities, thus slightly 

increasing the total burden associated 

with this collection. The Departments 

estimate that the costs associated with 

certified IDR entity requests for the 

extension would be $99 in 2024 and 

$197.80 annually beginning in 2025. 

This cost is explained in further detail 

in section V.F.8. of this preamble. 

k. Registration of Group Health Plans 

and Health Insurance Issuers 

Establishing the Federal IDR registry 

would impose a cost on the 

Departments by requiring them to 

develop and build the registry. The 

Departments anticipate incurring a cost 

of approximately $3,000,000 to develop 

and build the Federal IDR registry in FY 

2024, with annual ongoing costs to 

maintain the registry of $150,000 on 

average thereafter. Additionally, 

enrolling in the Federal IDR registry 

would impose a cost on issuers and 

plans by requiring them to submit 

information to the Departments. These 

costs amount to $1,573,693 in 2024 and 

$94,252 annually beginning in 2025 and 

are further described in section V.F.9. of 

this preamble. 

3. Uncertainties 

While the Departments are of the view 

that the majority of issuers and TPAs 

have the capability to use single CARC 

and RARC combinations on ERA 

transactions, the Departments are 

uncertain about the current level of use 

within the industry and whether issuers 

and TPAs have the capability to 

incorporate this information on paper 

remittance advice. Further, the 

Departments are uncertain about the 

current capability or percentage of 

issuers and TPAs that have the ability 

to use multiple CARC and RARC 

combinations for individual line items, 

including on electronic and paper 

remittance advice; what barriers and 

challenges issuers and TPAs would face 

to implement and operationalize this 

capability; and whether substantial 

system changes would need to be 

implemented to effectuate this proposed 

policy. 

It is unclear whether the Federal IDR 

process would experience the same 

operating conditions, such as the 

number of ineligible disputes submitted 

or the number of disputes that would be 

closed for nonpayment of the 

administrative fee, if all or some of the 

policies proposed in these proposed 

rules are finalized and implemented. 

While these factors would have a direct 

impact on the expenditures made by the 

Departments to carry out the Federal 

IDR process, it is difficult to project the 

impact that may result to the 

administrative fee amount charged to 

the parties. It is also uncertain how 

many disputes would be considered 

low-dollar disputes in the future, which 

would impact how many parties would 

be charged the proposed reduced 

administrative fee for low-dollar 

disputes, and it is uncertain how many 

disputes would be determined ineligible 

if the proposals in these rules are 

finalized, which would impact how 

many non-initiating parties would be 

charged the proposed reduced 

administrative fee for ineligible 

disputes. 

Furthermore, it is unclear if or when 

the proposed departmental eligibility 

review, which would allow the 

Departments to make eligibility 

determinations rather than certified IDR 

entities, may need to be invoked. The 

departmental eligibility review would 

impact dispute processing times and 

overall certified IDR entity operations; 

further, these factors may impact what 

percentage of disputes are settled or 

withdrawn after initiation but before 

offer submission. 

The economies of scale that may be 

realized by batching qualified IDR items 

and services are uncertain, including 

whether there would be a reduction in 

the amount of fees each party has to pay 

since parties would generally be 

allowed to batch more items and 

services in a single dispute than under 

the vacated provisions (discussed in 

section II.E.2. of this preamble). The 

specific provisions of the batching 

proposal may have differing effects on 

the trends in dispute initiation overall. 

For example, the increased flexibility to 

batch based on a single patient 

encounter may increase initiation of 

batched disputes, while the proposed 

cap on the number of line items within 

a batch may require parties that 

previously submitted batches with a 

high number of line items to divide the 

claims across multiple batched disputes. 

Further, the Departments are of the view 

that the increased batching flexibilities 

in concert with the reduced 

administrative fee for low-dollar 

disputes, if finalized, could lead to an 

increase in disputes initiated, since 

these policies may result in the Federal 

IDR process becoming more accessible 

to providers and payers. For these 

reasons, the Departments recognize the 

uncertainty in estimating the potential 

impact on the number of disputes 

submitted, and thus the fees collected, 

due to the proposed batching 

provisions. Further, it is uncertain if 

increased batching would lead to 

decreased collection of funds by the 

Departments if fewer administrative fees 

are paid. 

It is uncertain how much time would 

be needed for plans, issuers, carriers, 

and TPAs to collect the registration 

information that they would be required 

to provide under these proposed rules. 

Furthermore, it is unclear how many 

group health plans would choose to selfregister for the proposed IDR registry, 

rather than relying on a TPA or other 

third party to register on their behalf. If 

a significant number of group health 

plans self-register, this may increase the 

burden to industry as well as the 

operational burden to the Departments 

to create and maintain the registry. 

Although the Departments have 

analyzed the last 12 months of Federal 

IDR process data available to inform 

their projections, it is uncertain if the 

trends in this data will remain 

applicable for two reasons. First, the 

Federal IDR process is still in an early 

phase of implementation and has not 

yet achieved the stabilization that 

occurs with long-term uptake of the 

process. Initially, the Departments 

estimated that approximately 22,000 

disputes would be submitted to the 

process each year; 205 uptake of the 

process, however, has rapidly outpaced 

that estimate as dispute initiations have 

grown exponentially since 

implementation, and analysis has 

revealed an estimated number closer to 

420,000 annual disputes 206 would have 

been more accurate. 

Second, although each of the 

proposed provisions could be 

implemented separately and is 

severable, when reviewed holistically, 

implementation of these proposed 

policies would create comingled 

impacts, including on the number and 

type of disputes initiated, such that it is 

uncertain what the overall collective 

impact of these proposed policies would 

be. For example, although the 

Departments project a 50 to 75 percent 

decrease in the number of ineligible 

disputes as discussed further in section 

V.D.1.l. of this preamble, other policies 

such as expanded batching and the 

reduced administrative fee for lowVerDate Sep<11>2014 18:08 Nov 02, 2023 Jkt 262001 PO 00000 Frm 00083 Fmt 4701 Sfmt 4702 E:\FR\FM\03NOP2.SGM 03NOP2

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207Centers for Medicare & Medicaid Services. 

(May 1, 2022). May 2022 National Occupational 

Employment and Wage Estimates. https:// 

www.bls.gov/oes/current/oes_nat.htm. 

dollar disputes are anticipated to 

increase access to the Federal IDR 

process, such that the total number of 

disputes initiated yearly may increase 

overall. Additionally, the proposed 

framework for administrative fees that, 

if finalized, would result in a reduced 

administrative fee for some disputing 

parties when a dispute is ineligible or 

low-dollar complicates the analysis of 

what types of disputes would be 

initiated under these proposed rules. 

Further, the policies designed to 

increase communication between the 

disputing parties, such as the registry, 

open negotiation, and dispute initiation 

provisions, are anticipated to reduce the 

number of ineligible disputes initiated 

and increase the number of disputes 

resolved through open negotiation. 

However, the Departments are uncertain 

whether additional parties will utilize 

the Federal IDR process due to these 

process improvements, which would 

ultimately bring more disputes into the 

process. 

Overall, some of the proposed policies 

may reduce the number of disputes 

while others may increase the number 

of disputes initiated. Additionally, 

whether there will be a reduction in 

costs to the disputing parties is also 

uncertain under these collective 

proposals. For example, a provider that 

previously felt that the nature of their 

practice made it infeasible to initiate a 

dispute due to financial concerns may 

find the Federal IDR process more 

financially accessible under the 

proposed reduced administrative fee 

framework, thus incurring the 

associated cost and administrative fees 

and increasing the annual dispute 

number. 

4. Regulatory Review Cost Estimation 

If regulations impose administrative 

costs on entities, such as the time 

needed to read and interpret rules, 

regulatory agencies should estimate the 

total cost associated with regulatory 

review. Based on comments received for 

the July 2021 interim final rules and 

October 2021 interim final rules, the 

Departments estimate that more than 

2,100 entities will review these 

proposed rules, including 1,500 issuers, 

205 TPAs, and at least 395 other 

interested parties (for example, State 

insurance departments, State 

legislatures, industry associations, 

advocacy organizations, and providers 

and provider organizations). The 

Departments acknowledge that this 

assumption may understate or overstate 

the number of entities that will review 

these proposed rules. 

Using the mean hourly wage rate from 

the Bureau of Labor Statistics for a 

Lawyer (Code 23–1011) to account for 

average labor costs (including a 100 

percent increase for the cost of fringe 

benefits and other indirect costs), the 

Departments estimate that the cost of 

reviewing these proposed rules would 

be $157.48 per hour.207 The 

Departments estimate, based on an 

average reading speed of 200 to 250 

words per minute, that it would take 

each reviewing entity approximately 10 

hours to review these proposed rules, 

with an associated cost of 

approximately $1,574.80 (10 hours × 

$157.48 per hour). Therefore, the 

Departments estimate that the total 

burden to review these proposed rules 

will be approximately 21,000 hours 

(2,100 reviewers × 10 hours per 

reviewer), with an associated cost of 

approximately $3,307,080 (2,100 

reviewers × $1,574.80 per reviewer). 

The Departments welcome comments 

on this approach to estimating the total 

burden and cost for interested parties to 

read and interpret these proposed rules. 

E. Regulatory Alternatives— 

Departments of Health and Human 

Services and Labor 

In developing these proposed rules, 

the Departments considered various 

alternative approaches. 

1. Required Use of CARCs and RARCs 

The Departments considered applying 

the proposed requirement to use CARCs 

and RARCs under new 26 CFR 54.9816– 

6A, 29 CFR 2590.716–6A, and 45 CFR 

149.100 only to claims subject to the 

surprise billing protections of the No 

Surprises Act. However, the 

Departments have become aware that 

providers, facilities, and providers of air 

ambulance services have sought to 

initiate open negotiations or the Federal 

IDR process for a sizeable number of 

claims that are not subject to the No 

Surprises Act. Therefore, the 

Departments have concluded that it 

would be helpful for plans and issuers 

to communicate information regarding 

the applicability of the No Surprises Act 

for all out-of-network claims, and that a 

narrower application would be less 

impactful. Thus, the proposed approach 

may reduce the number of ineligible 

claims submitted, as further described 

in section V.D.1.l. of this preamble. 

The Departments considered 

specifying in regulation which CARCs 

and RARCs must be used, rather than 

providing this information in guidance. 

The Departments are working to 

understand and address the current 

backlog of disputes slowing down the 

Federal IDR process. The Departments 

have concluded that retaining the 

flexibility to identify the CARCs and 

RARCs to be used in specified scenarios 

in guidance rather than through notice 

and comment rulemaking would 

provide greater ability to quickly 

address communication gaps that are 

contributing to this backlog and future 

implementation challenges, as the 

Departments better understand these 

gaps. This also mirrors the current 

approach for required CARC and RARC 

code combinations that must be used by 

HIPAA-covered entities in business 

scenarios, as specified in guidance. 

The Departments also considered 

continuing to support the voluntary use 

of No Surprises Act-specific RARCs. 

The Departments recognize the 

additional burden that requiring certain 

RARCs may place on small entities that 

may have fewer dedicated IT and coding 

staff. However, since the RARC 

Committee approved a set of RARCs for 

optional use, effective March 1, 2022, 

providers, facilities, and providers of air 

ambulance services and plans and 

issuers have continued to report 

communication challenges and to 

request more standardized mechanisms 

for communicating information. The 

Departments concluded that requiring 

certain CARCs and RARCs in specific 

circumstances, as well as continuing to 

permit the use of voluntary RARCs at 

the discretion of plans and issuers, 

would provide a more effective means 

of standardizing communication and 

better achieve a number of aims, 

including improving information flow 

between plans and issuers and 

providers, facilities, and providers of air 

ambulance services and consequently 

reducing the submission of ineligible 

claims to the Federal IDR process. 

2. Open Negotiation Provision Changes 

(26 CFR 54.9816–8(b)(1), 29 CFR 

2590.716–8(b)(1), and 45 CFR 

149.510(b)(1)) 

The Departments propose to amend 

the open negotiation provisions at 26 

CFR 54.9816–8(b)(1)(i), 29 CFR 

2590.716–8(b)(1)(i), and 45 CFR 149.510 

(b)(1)(i) to require the party initiating 

open negotiations to provide an open 

negotiation notice and supporting 

documentation to the other party and 

the Departments to initiate the open 

negotiation period. Furthermore, the 

party in receipt of the open negotiation 

notice would be required to provide a 

response to the open negotiation notice 

to the other party and the Departments 

no later than the 15th business day of 

the 30-business-day open negotiation 

period. 


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The Departments considered 

alternative ways for the party initiating 

open negotiation to notify the 

Departments of the initiation of open 

negotiations instead of submitting the 

notice through the Federal IDR portal. 

The Departments considered having the 

party submitting the open negotiation 

notice notify the Departments via mail 

or email but decided that the portal 

would provide a more logical place for 

the notice to be provided, as this is 

where Federal IDR process information 

is stored. The Departments also 

considered taking no action and 

maintaining the current process in 

which parties initiating open 

negotiation do not inform the 

Departments directly of the initiation of 

open negotiations. However, the 

Departments are of the view that these 

changes are necessary to make it 

explicitly clear to the Departments 

when open negotiations are initiated in 

order to best track the flow of Federal 

IDR process dispute initiations. The 

Departments are of the view that these 

proposals would create more certainty 

regarding whether and when the party 

initiating open negotiation begins open 

negotiations by ensuring that start and 

end dates are documented in the 

Federal IDR portal, which is the official 

place of record for the Federal IDR 

process. Further, the Departments 

acknowledge the additional burden that 

small entities may face in meeting the 

requirements of the Federal IDR process 

since they may not have dedicated staff 

to perform all the functions necessary to 

meet the requirements. However, the 

Departments are of the view that the 

proposed policy to centralize the 

submission of open negotiation notices 

through the Federal IDR portal would 

alleviate burden on small entities as it 

would reduce the number of channels 

they previously submit these notices 

through. 

The Departments also considered 

alternatives to requiring the party in 

receipt of the open negotiation notice to 

provide a response to the open 

negotiation notice within the 30- 

business-day open negotiation period. 

The Departments considered 

maintaining the status quo of not 

requiring this response, but are of the 

view that creating this requirement 

would be the better alternative, because 

this proposal would create an additional 

exchange of eligibility-related 

disclosures between the parties and 

foster better communication between 

the parties to improve the Federal IDR 

process. 

The Departments also propose to 

require that the open negotiation notice 

contain additional specific information 

and be in a specific format as discussed 

in section II.D.1.c. of this preamble. The 

Departments further propose to require 

that the open negotiation response 

notice must be provided, using the 

standard form developed by the 

Departments, no later than the 15th 

business day of the 30-business-day 

open negotiation period, and the party 

in receipt of the open negotiation notice 

must provide the open negotiation 

response notice through the Federal IDR 

portal resulting in receipt by the party 

initiating open negotiation and the 

Departments on the same day. The 

Departments considered maintaining 

the status quo and not requiring the 

additional information, the specific 

format, or timing, but determined that 

this proposal would create an additional 

exchange of information necessary to 

help the Federal IDR process be 

successful, allow certified IDR entities 

to make more informed decisions, and 

improve communication between the 

parties. 

3. Changes to the Initiation of the 

Federal IDR Process and the Notice of 

IDR Initiation (26 CFR 54.9816–8(b)(2), 

29 CFR 2590.716–8(b)(2), and 45 CFR 

149.510(b)(2)) 

The Departments propose to amend 

the IDR initiation provisions of 26 CFR 

54.9816–8(b)(2), 29 CFR 2590.716– 

8(b)(2), and 45 CFR 149.510(b)(2) to 

accelerate dispute processing and 

reduce the burden on certified IDR 

entities. Specifically, the Departments 

propose to require the initiating party to 

provide an enumerated list of additional 

information on the notice of IDR 

initiation, including a statement 

describing the aspects of the claim, such 

as patient acuity or level of training, any 

payment discussed by the parties during 

open negotiation, whether the reasons 

for initiating the Federal IDR process are 

different from the aspects of the claim 

discussed during the open negotiation 

period, and an explanation of why the 

party is initiating the Federal IDR 

process. 

Similarly, the Departments propose to 

require the non-initiating party to 

provide a response to the notice of IDR 

initiation, within 3 business days after 

the date of IDR initiation, that must 

include an enumerated list of 

information, including an agreement or 

disagreement that the dispute is eligible 

for the Federal IDR process, supporting 

documentation if the non-initiating 

party believes a dispute is not eligible, 

and an agreement to the preferred 

certified IDR entity identified in the 

notice of IDR initiation or an alternate 

preferred certified IDR entity selection. 

The Departments propose to require 

these notices to be provided to the other 

party and the Departments 

electronically through the Federal IDR 

portal. 

The Departments considered 

alternatives to these notices and the 

information they are required to 

contain, including contemplating 

notices that contained less required 

information. Recognizing the increased 

administrative burden of providing this 

additional information within the 

specified timeframe, particularly for 

small entities that may regularly engage 

with the IDR process and may not have 

staff dedicated to perform this function, 

the Departments also considered 

maintaining the status quo, but instead 

determined that these notices are 

necessary to address processing and 

communication issues caused by the 

lack of information. These new 

requirements would provide 

information to the certified IDR entities 

that is frequently missing under the 

status quo. 

Each of the new required elements 

would provide specific information 

needed by the certified IDR entities to 

successfully conduct the Federal IDR 

process. The lack of these information 

elements creates a burden on the 

certified IDR entities, as they are 

currently required to undertake 

concerted efforts to obtain the 

information from the parties or other 

sources. This has resulted in additional 

time and effort for the certified IDR 

entities and caused the process to move 

at a slower pace than is desired. The 

Departments are of the view that 

requiring the parties to provide these 

notices and the information contained 

in them within the timeframes and in 

the manner proposed would result in a 

reduction in this burden on the certified 

IDR entities and would result in greater 

efficiency of the Federal IDR process 

overall. Additionally, the Departments 

are of the view that these additional 

elements would assist in determining 

whether the items or services associated 

with the dispute are eligible for the 

Federal IDR process, allow for a 

streamlined process to track dispute 

initiation, enhance communication 

between the parties, and facilitate a 

more efficient process of IDR initiation. 

4. Certified IDR Entity Selection (26 CFR 

54.9816–8(c)(1), 29 CFR 2590.716– 

8(c)(1), and 45 CFR 149.510(c)(1)) 

The Departments propose to establish 

a process for the preliminary selection 

of the certified IDR entity and final 

selection of the certified IDR entity at 26 

CFR 54.9816–8(c)(1), 29 CFR 2590.716– 

8(c)(1), and 45 CFR 149.510(c)(1). 


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Specifically, the Departments propose 

amending the preliminary selection of 

the certified IDR entity process to 

establish that if the party last in receipt 

of either the notice of IDR initiation 

response or the notice of certified IDR 

entity selection received the notice on 

the third business day after the date of 

IDR initiation and did not agree to the 

other party’s alternative preferred 

certified IDR entity by the end of third 

business day after the date of IDR 

initiation, the Departments would 

provide the party 2 additional business 

days to agree or object to other party’s 

alternative preferred certified IDR entity 

selection. Further, the Departments 

propose to clarify that the date of 

preliminary selection of the certified 

IDR entity would be 3 business days 

after the date of IDR initiation if the 

parties jointly selected a certified IDR 

entity, or 6 business days after the date 

of IDR initiation if the parties fail to 

jointly select a certified IDR entity and 

the Departments select a certified IDR 

entity either based on the agreement (or 

failure to respond) of the party in 

receipt of the last notice (either the 

notice of IDR initiation response or the 

notice of certified IDR entity selection) 

or through random selection. Lastly, the 

Departments propose to establish the 

process for finalizing selection of the 

certified IDR entity at 26 CFR 54.9816– 

8(c)(1)(iv), 29 CFR 2590.716–8(c)(1)(iv), 

and 45 CFR 149.510(c)(1)(iv), which 

would establish that the date of final 

selection of the certified IDR entity is 

the date the Departments provide notice 

to the parties that the preliminarily 

selected certified IDR entity attests that 

it meets the conflict-of-interest 

requirements. 

The Departments considered 

alternatives to this proposal. The 

Departments considered maintaining 

the status quo and not modifying the 

process of selecting a certified IDR 

entity. However, given that the current 

rules allow the conflict-of-interest 

review to coincide with the eligibility 

review, the Departments are of the view 

that creating a finalization stage of 

certified IDR entity selection in the 

Federal IDR process would improve 

efficiency and reduce confusion when 

completing certified IDR entity 

selection. The Departments are of the 

view that this proposed policy would 

not increase burden for disputing 

parties, including small entities, as the 

time period requirement for disputing 

parties to jointly select a certified IDR 

entity is not changing. The Departments 

are of the view that the certified IDR 

entity must be considered preliminarily 

selected until it is determined that the 

certified IDR entity has no conflict of 

interest, and that the conflict-of-interest 

review should not cut into the time 

periods for either disputing party to 

submit their offers or for the certified 

IDR entity to make a payment 

determination. 

5. Federal IDR Eligibility 

Determinations (26 CFR 54.9816– 

8(c)(1)(v), 29 CFR 2590.716–8(c)(1)(v), 

and 45 CFR 149.510(c)(1)(v)) 

The Departments propose to amend 

26 CFR 54.9816–8(c), 29 CFR 2590.716– 

8(c), and 45 CFR 149.510(c) regarding 

Federal IDR eligibility determinations to 

make the Federal IDR process eligibility 

reviews the responsibility of the 

Departments under certain 

circumstances. Under this proposal, 

when a departmental eligibility review 

is in effect, the Departments would 

determine whether the dispute is 

eligible for the Federal IDR process. If 

the dispute is found to be eligible, the 

Departments would send it to the 

certified IDR entity to continue the 

Federal IDR process. If the dispute is 

found to be ineligible for the Federal 

IDR process, it would be closed. 

The Departments considered being 

more involved in the entire eligibility 

review process on a permanent basis; 

however, once the Federal IDR process 

arrives at a steadier operational state, 

the Departments are of the view that the 

majority of eligibility work—in 

particular eligibility determinations— 

should be conducted by certified IDR 

entities, particularly if the other 

proposed policies in these proposed 

rules and non-regulatory improvements 

are successful in improving throughput. 

The Departments also considered 

maintaining the status quo of certified 

IDR entities performing the full scope of 

the eligibility determination process, 

but the burden of making these 

eligibility determinations has proven to 

be complex and time-consuming for 

certified IDR entities, and the statute 

only affords certified IDR entities the 

ability to collect the certified IDR entity 

fee when a payment determination is 

made. A payment determination can 

only be made for eligible disputes, so 

certified IDR entities are not able to 

keep any portion of their fee for 

disputes they determine are ineligible. 

This situation results in certified IDR 

entities being uncompensated for 

eligibility determination work on 

ineligible disputes. The Departments do 

not anticipate that this policy, if 

finalized as proposed, would have a 

differential impact on small entities. 

Therefore, the Departments are 

proposing this provision in a manner 

that provides the Departments with the 

flexibility to move the responsibility for 

Federal IDR eligibility determinations 

between the Departments and certified 

IDR entities, as appropriate and with 

appropriate notice to interested parties. 

6. Withdrawals (26 CFR 54.9816–8(c)(3), 

29 CFR 2590.716–8(c)(3), and 45 CFR 

149.510(c)(3)) 

The Departments propose to add 26 

CFR 54.9816–8(c)(3)(ii), 29 CFR 

2590.716–8(c)(3)(ii), and 45 CFR 

149.510(c)(3)(ii) to establish a process 

for disputes to be withdrawn from the 

Federal IDR process. Specifically, the 

Departments propose that a dispute may 

be withdrawn from the Federal IDR 

process if: (1) the initiating party 

provides notification through the 

Federal IDR portal to the Secretary and 

the certified IDR entity (if selected) that 

both parties agree to withdraw the 

dispute from the Federal IDR process, 

with signatures from authorized 

signatories for both parties; (2) the 

initiating party provides a standard 

withdrawal request notice to the 

Departments, the certified IDR entity (if 

selected), and the non-initiating party, 

and the non-initiating party notifies the 

Secretary, certified IDR entity (if 

selected), and initiating party of its 

agreement to withdraw within 5 

business days of the initiating party’s 

request (or the non-initiating party fails 

to respond within 5 business days of the 

initiating party’s request); (3) the 

certified IDR entity or the Departments 

cannot determine eligibility because 

both parties to the dispute are 

unresponsive to any requests for 

additional information to determine 

eligibility; or (4) the certified IDR entity 

cannot make a payment determination 

because both parties to the dispute have 

failed to submit an offer as described in 

26 CFR 54.9816–8(c)(5)(i), 29 CFR 

2590.716–8(c)(5)(i), and 45 CFR 

149.510(c)(5)(i). 

The Departments considered 

alternatives to this proposal. The 

Departments considered maintaining 

the status quo and not formalizing the 

process for disputes to be withdrawn. 

The Departments recognize that the 

withdrawal process may place 

particular burden on resource 

constrained small entities, that may face 

greater challenges meeting the 

timetables described in this proposal. 

However, given that the current rules do 

not establish a clear uniform process for 

disputes to be withdrawn, the 

Departments are of the view that these 

proposals would encourage efficiency 

by creating a centralized process for the 

parties to request a withdrawal of a 

dispute and requiring that the dispute 

would be withdrawn in the event the 


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208Centers for Medicare & Medicaid Services. 

(October 20, 2022). Restructured BETOS 

Classification System. https://data.cms.gov/ 

provider-summary-by-type-of-service/providerservice-classifications/restructured-betosclassification-system. 

parties are nonresponsive within the 

required timeframes. Further, the 

Departments also are of the view that 

permitting the withdrawal of a dispute 

in these cases would decrease the 

number of payment determinations the 

certified IDR entity is required to 

adjudicate. 

7. Treatment of Batched Items and 

Services (26 CFR 54.9816–8(c)(4), 29 

CFR 2590.716–8(c)(4), and 45 CFR 

149.510(c)(4)) 

After considering feedback from 

interested parties, the Departments are 

of the view that the batching rules 

should be amended to capture 

additional efficiencies and expand 

access to the Federal IDR process, while 

avoiding combinations of unrelated 

claims in a single dispute that could 

unnecessarily complicate an IDR 

payment determination and operate to 

reduce efficiency. The Departments also 

anticipate that these batching policies, if 

finalized as proposed, would be 

particularly beneficial to small entities. 

By offering greater flexibility, these 

policies will improve the economic cost 

of the Federal IDR process and reduce 

the burden on small entities’ billing and 

coding staff. 

The Departments considered different 

approaches to expand the batching rules 

at proposed 26 CFR 54.9816–8(c)(4), 29 

CFR 2590.716–8(c)(4), and 45 CFR 

149.510(c)(4) for determining whether 

the items or services are related to 

treatment of a similar condition. In 

particular, the Departments considered 

approaches that relied on existing code 

sets that would capture a wider range of 

items and services than those under the 

current regulations, including the 

vacated provisions (discussed in section 

II.E.2. of this preamble). The rationale 

underlying batching based on code sets 

(or subsets of those code sets) is that 

based on the manner in which these 

code sets were built (by medical and 

coding professionals and others), the 

code sets present a reasonable basis 

upon which to conclude that certain 

sections (or subsections) of those code 

sets describe items and services that are 

related to the treatment of a similar 

condition. 

The broadest potentially workable 

standard the Departments considered 

for determining whether the items or 

services are related to treatment of a 

similar condition is the Berenson-Eggers 

Type of Service (BETOS) codes. The 

BETOS coding system was originally 

developed for analyzing the growth in 

Medicare expenditures and is not 

utilized for the purposes of billing.208

The Restructured BETOS Classification 

System (RBCS) includes HCPCS Level I 

codes (commonly referred to as ‘‘CPT 

codes’’) and HCPCS Level II codes 

(commonly referred to as ‘‘HCPCS 

codes’’) and groups CPT and HCPCS 

procedural codes into a few very broad 

categories: (1) anesthesia, (2) evaluation 

and management, (3) procedures, (4) 

imaging, (5) tests, (6) durable medical 

equipment, (7) treatment, and (8) other. 

However, this could theoretically offer 

unlimited batching of services furnished 

by specialty providers and, accordingly, 

result in batches that would be difficult 

for certified IDR entities to adjudicate in 

a timely manner. While this coding 

system is stable over time and is 

relatively immune to minor changes in 

technology or practice patterns, this 

approach would require parties and 

certified IDR entities to learn and 

become familiar with a new framework 

for categorizing items and services for 

the specific purpose of engaging with 

the Federal IDR process. The 

Departments are of the view that this 

would result in confusion and an 

exacerbation of backlog issues. 

The Departments also considered 

allowing initiating parties to batch all 

items and services with the same ICD– 

10 diagnosis code. Every medical claim 

includes at least one ICD–10 diagnosis 

code, including a primary diagnosis 

code and optional secondary diagnosis 

codes. There are approximately 68,000 

ICD–10 diagnosis codes that cover a 

wide variation in patient diagnoses. 

Given the wide variation in diagnoses 

and the fact that a single ICD–10 

diagnosis code can cover a wide range 

of individual items or services, it is 

conceivable that diagnosis codes are not 

a reasonable basis upon which to 

determine that items or services 

provided to different patients 

sufficiently relate to treatment of a 

similar condition. Furthermore, the 

Departments are of the view that this 

level of variation could create 

complexity for disputing parties and 

certified IDR entities and increase the 

risk of inconsistent batching 

determinations. 

In addition to batching based on code 

sets, the Departments considered 

specific recommendations from 

interested parties on creating additional 

batching flexibilities for determining 

whether the items or services are related 

to treatment of a similar condition. As 

discussed in section II.E.2. of this 

preamble, anesthesiologists have 

advocated for batching by conversion 

factor since contracting practices for 

anesthesiology items and service focus 

on conversion factor rates. The 

Departments are of the view that this 

approach would undermine the 

Departments’ efforts to increase 

efficiency in the Federal IDR process. 

Because conversion factors would be 

identical for every out-of-network 

service furnished by an anesthesiologist 

provider or provider group, the ‘‘same 

conversion factor’’ requirement results 

in the provider or provider group being 

able to batch every out-of-network 

service it furnishes that otherwise 

satisfies the requirements of the 

batching rules at proposed 26 CFR 

54.9816–8(c)(4), 29 CFR 2590.716– 

8(c)(4), and 45 CFR 149.510(c)(4). 

Instead, the Departments are of the view 

that batching based on CPT code 

categories would lead to greater 

efficiency, would more closely align 

with the interpretation of treatment of a 

similar condition, and would lead to 

less risk in the variability among the 

items and services and factual 

circumstances that certified IDR entities 

must consider. 

Additionally, the Departments 

considered feedback provided by 

emergency physicians, who stated that 

the nature of emergency care makes it 

difficult for them to batch claims under 

the current rules and suggested that the 

batching rules should allow for the most 

common evaluation and management 

CPT codes (99281–99285) to be batched 

together. However, the Departments 

have concluded that in the context of 

emergency care, the acuity of a patient 

may vary substantially in these 

circumstances. This means that certified 

IDR entities would need to review 

complex and disparate factual 

conditions for each item or service in a 

batch pertaining to emergency care, 

which would be extremely time 

consuming. Batching in these 

circumstances would therefore 

exacerbate payment determination 

delays and compound the backlog of 

disputes. 

Similarly, the Departments 

considered allowing batching of all 

items and services within one of the six 

major sections of the CPT code book: (1) 

evaluation & management, (2) 

anesthesiology, (3) surgery, (4) 

radiology, (5) pathology and laboratory, 

and (6) medicine. This could allow 

batching of the services most often 

provided by emergency physicians, 

anesthesiologists, radiologists, 

pathologists, and other specialty 

providers. Due to the breadth of CPT 


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codes relevant to surgery and radiology 

services, the Departments considered 

further limiting providers’ batching 

ability to the specific services 

represented by the code spans relevant 

to each row in Table 8 that correlates to 

surgery or radiology services. While 

these delineations could serve as 

straightforward guidelines that may 

result in consistent application of a 

batching standard across certified IDR 

entities, the Departments are of the view 

that variations in these services within 

a batched dispute could present 

challenges to certified IDR entities’ 

efficient resolution of disputes due 

again to the fact-specific and time 

intensive nature of reviewing 

information specific to each item or 

service within a batch. 

The Departments are of the view that 

specific, narrower ranges within CPT 

Category I sections could mitigate this 

risk, more closely relate to the treatment 

of a similar condition, and encourage 

efficiencies of the Federal IDR process. 

Further, the Departments are of the view 

that batching based on CPT code 

categories would lead to greater 

efficiency, would more closely align 

with the interpretation of treatment of a 

similar condition, and would lead to 

less risk in the variability among the 

items and services and factual 

circumstances that certified IDR entities 

must consider. Thus, in balancing the 

need to create a workable batching rule 

for all parties and encouraging 

efficiency (including minimizing costs) 

to the Federal IDR process, the 

Departments determined that it would 

be appropriate to propose amendments 

to allow qualified IDR items and 

services to be batched by: (1) items and 

services furnished to a single patient 

during a patient encounter on one or 

more consecutive dates of service and 

billed on the same claim form (single 

patient encounter); (2) items and 

services furnished to one or more 

patients and billed under the same 

service code, or a comparable code 

under a different procedural code 

system; or (3) anesthesiology, radiology, 

pathology, and laboratory IDR items and 

services furnished under service codes 

belonging to the same Category I CPT 

code range, as specified in guidance by 

the Departments, in order to address the 

unique circumstances of certain medical 

specialties and provider types. 

Because these proposed rules would 

potentially allow batching of an 

unlimited number of qualified IDR 

items or services, the Departments also 

considered different approaches to 

mitigate the risk of large batches that 

may require certified IDR entities to 

review the eligibility for each line item, 

the acuity of each patient and/or other 

payment determination factors for each 

line item in the batch. First, the 

Departments considered modifying 

regulations related to the certified IDR 

entity fee to permit certified IDR entities 

to charge per line item. However, the 

Departments are of the view that a per 

line-item charge would present cost 

challenges for providers with lower 

dollar-value claims when utilizing the 

Federal IDR process. The Departments 

subsequently considered modifying the 

IDR entity fee structure such that the 

certified IDR entity could charge per 

unique service code, so that certified 

IDR entities would be able to be 

adequately compensated for the time 

and work involved in payment 

determinations, while allowing for 

flexibility to batch a greater number of 

line items per dispute. However, given 

the Departments’ experience in 

managing the Federal IDR process, the 

Departments are of the view that such 

a modification to the certified IDR entity 

fee structure would still necessitate a 

line-item limit to ensure certified IDR 

entities are able to make payment 

determinations within the required 30- 

business-day period. It is the 

Departments’ understanding that a per 

service code charge and line-item limit 

combined may unnecessarily restrict 

access to the Federal IDR process. 

The Departments also considered 

limiting a batched dispute to more than 

25 different payment offers. For line 

items in which the payment offers are 

equal, the certified IDR entity could 

resolve all such line items through its 


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TABLE 8: CPT Level I HCPCS Codes Groupings 

CPT Level I HCPCS Codes (CPT) Code Span Description 

99202 - 99499 Evaluation and Management 

00100 - 01999 Anesthesia 

10004 - 19499 Surgery/lntegumentary System 

20100 - 29999 Surgery/Musculoskeletal System 

33016 - 39599 Surgery /Cardiovascular System 

40490 - 49999 Surgery/Digestive System 

50010 - 53899 Surgery/Urinarv Svstem 

54000 - 55980 Surgery/Male Genital System 

56405 - 58999 Surgery/Female Genital Svstem 

60000 - 60599 Surgery/Endocrine System 

61000 - 64999 Surgery/Nervous Svstem 

65091 - 68899 Surgery/Eye and Ocular Adnexa 

69000 - 69979 Surgery/Auditory Svstem 

70010 - 77092 Radiology /Diagnostic Radiology /Diagnostic 

Ultrasound 

77261 - 79999 Radiolo!!v /Radiation Oncolo!!v IN uclear Medicine 

80047 - 89398 Pathology and Laboratory/Proprietary Laboratory 

000lU - 0284U Analysis 

90281 - 99607 Medicine 
Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75831 

review of a single set of facts and 

documentation. A few certified IDR 

entities noted that it is easier to resolve 

payment determinations if the QPA is 

the same across codes. However, to 

accommodate batching of more than 25 

qualified IDR items and services with 

equal payment offers, the initiating 

party would need to provide the offer 

for each line item or service earlier in 

the process such as during open 

negotiation or in the notice of IDR 

initiation as opposed to only at the time 

of the notice of offer. The Departments 

are of the view that this option would 

prove challenging because it would 

raise the issue of how to handle the 

limit of unique payment offers if the 

non-initiating party disagrees with the 

amount of unique payment offers. 

Further, under this approach, if the 

Departments would require offer 

information at the time of IDR initiation, 

the initiating party would only have 4 

days to determine their offer following 

the end of the open negotiation period. 

Lastly, the Departments considered 

imposing line-item limits to mitigate the 

risk of unwieldy batches. Specifically, 

the Departments considered proposing a 

limit of no more than 50 qualified IDR 

items or services in a batched 

determination. As of June 6, 2023, the 

average number of line items per 

batched dispute was 9 line items from 

April 2022 to June 2023. The 

Departments considered that while the 

average number of line items per 

batched dispute is much lower than the 

50-line-item limit, this data is reflective 

of the number of line items a party can 

submit under the same service code, or 

a comparable code under a different 

procedural code system, and that there 

may likely be a higher average with the 

additional proposed batching 

flexibilities. Further, the Departments 

considered that 50 line items might, in 

some cases, still allow certified IDR 

entities to resolve payment 

determinations within the required 30- 

business-day period. However, based on 

their experience making payment 

determinations under the current 

batching rule, many certified IDR 

entities stated that batched 

determinations with more than 25 line 

items would be difficult to render 

payment determinations within the 30- 

business-day period if the Departments 

proposed additional batching 

flexibilities. To ensure operational 

efficiency for certified IDR entities as 

they make their payment determinations 

and given the average number of line 

items in a batched dispute, the 

Departments propose to require that no 

more than 25 qualified IDR items and 

services may be considered jointly as 

part of one payment determination for 

the purposes of batched determinations. 

8. Administrative and Certified IDR 

Entity Fee Collection (26 CFR 54.9816– 

8T(d), 29 CFR 2590.716–8(d), and 45 

CFR 149.510(d)) 

The Departments considered 

maintaining the current policy that both 

the administrative fee and the certified 

IDR entity fee are due at the same time, 

later in the Federal IDR process. The 

Departments, however, determined that 

requiring a uniform 2-business-day 

requirement for the administrative fee to 

be paid by the parties was appropriate. 

The Departments are of the view that 

requiring payment by an initiating party 

within 2 business days of the date of 

preliminary selection of the certified 

IDR entity and by a non-initiating party 

within 2 business days of a notice of an 

eligibility determination by either the 

certified IDR entity or the Departments 

would substantially accelerate dispute 

throughput in the Federal IDR process 

and ensure that the costs of using the 

Federal IDR process are being allocated 

to both eligible and ineligible disputes. 

Further, the Departments considered 

requiring the initiating party to pay the 

administrative fee within 1 business day 

of the date of preliminary selection of 

the certified IDR entity. The 

Departments considered whether the 

initiating party, by virtue of being the 

party that brings the dispute into the 

Federal IDR process, takes a more active 

role from the outset, and it should 

therefore be aware that it would be 

required to pay the administrative fee 

soon after initiating the dispute. In 

contrast, the Departments considered 

whether it was appropriate to allow the 

non-initiating party an additional 

business day from the date of notice of 

an eligibility determination to pay the 

administrative fee, because the noninitiating party neither controls when 

the dispute is initiated nor when 

eligibility is determined. On balance, 

the Departments determined a uniform 

2 business day deadline from the date 

the administrative fee amount is 

determined (which is at preliminary 

selection of the certified IDR entity for 

the initiating party and at notification of 

an eligibility determination for the noninitiating party) was appropriate to 

allow equitable payment timeframes for 

both disputing parties. 

Further, the Departments considered 

requiring the non-initiating party to pay 

the administrative fee within 2 business 

days of preliminary selection of the 

certified IDR entity. However, because 

the Departments propose in these 

proposed rules that the non-initiating 

party may receive a reduced 

administrative fee for an ineligible 

dispute, the Departments determined 

requiring payment within 2 business 

days of notification of the eligibility 

determination was more appropriate. In 

making this determination, the 

Departments considered the additional 

burden associated with an overcharge to 

non-initiating parties for ineligible 

disputes, including the hold of 

additional administrative fees while 

eligibility is determined and operational 

costs to effectuate refunds to 

overcharged non-initiating parties. 

The Departments considered 

maintaining the status quo of certified 

IDR entities collecting the 

administrative fee on behalf of the 

Departments. However, collection of the 

administrative fee by the certified IDR 

entities is inefficient, increases the 

burden of uncompensated work to 

certified IDR entities when the volume 

of ineligible disputes is high, and has 

historically resulted in low collection 

rates for ineligible disputes partially due 

to the existing administrative fee 

collection timing. The Departments also 

considered direct collection of both the 

administrative fee and certified IDR 

entity fee. The Departments are of the 

view that direct payment of the fee by 

the parties to the organization to which 

payment is ultimately owed (the 

Departments for the administrative fee 

and the certified IDR entity for the 

certified IDR entity fee) is more 

appropriate, especially in light of the 

different timing of these fee collections. 

The Departments also considered only 

pursuing collection actions from all 

non-paying parties instead of moving up 

the timing of the fee collection. This 

option was counterbalanced by the 

expense associated with collection 

proceedings and the need to implement 

a policy that appropriately accounts for 

the financial burden of ineligible 

disputes. 

The Departments considered allowing 

disputes to be placed on a temporary 

hold while fees are paid. However, 

ensuring all appropriate Federal IDR 

process fees are paid was 

counterbalanced by the need to 

implement an efficient Federal IDR 

process to determine out-of-network 

rates between providers, facilities, and 

providers of air ambulance services and 

plans, issuers, and FEHB carriers. The 

Departments are also of the view that a 

hold would not incentivize nonresponsive parties to take action to 

challenge eligibility and further 

participate in open negotiation and the 

Federal IDR process, which are some of 

the goals of this proposal. 


lotter on DSK11XQN23PROD with PROPOSALS2
75832 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

The Departments also considered 

charging only the initiating party a 

reduced administrative fee for lowdollar disputes and charging the noninitiating party the full administrative 

fee; however, the Departments 

determined this may be unnecessarily 

punitive to non-initiating parties in lowdollar disputes. Before proposing the 

highest offer from a disputing party 

during open negotiation as the proper 

metric to determine whether a dispute 

is low-dollar, the Departments 

considered setting the threshold for lowdollar disputes based on several metrics 

including the QPA, billed charge 

amount, and submitted offer. The 

Departments are of the view that the 

QPA is inappropriate because interested 

parties have expressed concerns about 

relying on the QPA as a determinative 

factor in the Federal IDR process. 

Similarly, billed charge amount was 

discarded as an option because it is a 

statutorily prohibited factor in payment 

determinations; thus, including it as an 

anchoring point for the administrative 

fee amount in the Federal IDR portal 

may lead disputing parties to believe the 

billed charge amount would be 

improperly considered by the certified 

IDR entity in making the final payment 

determination. Additionally, it would 

be inappropriate to utilize the final offer 

amount for two reasons. First, the 

parties may not know their offer amount 

when the certified IDR entity is selected 

and the administrative fee is billed. 

Second, utilizing the initiating party’s 

offer amount may result in the noninitiating party having insight into the 

final offer of the initiating party, which 

may afford a negotiating advantage to 

non-initiating parties. 

The Departments also considered 

creating an administrative fee that 

would be scaled based on the value of 

the dispute initiated, such as charging 

each disputing party an administrative 

fee that was 20 percent of the value of 

the dispute submitted. The 

Departments, however, are of the view 

that this approach is not appropriate for 

two reasons. First, the value of disputes 

can have a wide range, such as a $5 

million dispute for a NICU inpatient 

hospital stay compared to a $500 

outpatient service. This example 

structure would result in parties to the 

former dispute paying a $1 million 

administrative fee and parties to the 

latter dispute paying a $100 

administrative fee. Second, the 

Departments recognize that resolving a 

dispute generally costs the Departments 

the same amount regardless of whether 

the dispute involves low-dollar or highdollar items or services, and the Federal 

IDR process is intended to streamline 

resolution of payment disputes between 

plans or issuers and providers or 

facilities. Further, the nature of 

estimating the administrative fee based 

on the expenditures made by the 

Departments in a given year means the 

administrative fee is not particularized 

to an individual dispute. This makes a 

sliding scale impractical to apply to the 

wide range of disputes subject to the 

Federal IDR process. Finally, the 

Departments considered maintaining a 

flat administrative fee applicable to all 

disputes but determined that the impact 

of a flat administrative fee amount on 

parties seeking to initiate low-dollar 

disputes could make the Federal IDR 

process cost prohibitive for some 

initiating parties. 

The Departments considered applying 

a standardized administrative fee to all 

parties in all disputes regardless of 

eligibility. After considering a uniform 

application, the Departments 

determined that a framework that better 

accounts for eligibility costs based on 

the role of the disputing party and the 

eligibility of the dispute was a more 

appropriate distribution of the 

Departments’ expenditures which the 

administrative fee is designed to recoup. 

The Departments also had concerns that 

non-initiating parties could be 

penalized by paying for an ineligible 

dispute if an initiating party 

indiscriminately submitted disputes; 

however, given that an initiating party 

must pay the administrative fee for a 

dispute to be considered fully submitted 

and for the fee to be assessed to both 

parties, the Departments are of the view 

that there are sufficient safeguards in 

place. Further, the Departments also 

considered not charging non-initiating 

parties for ineligible disputes; however, 

because the statute indicates that each 

party to a dispute is responsible for the 

administrative fee, and even in 

ineligible disputes the non-initiating 

party is benefiting from Federal IDR 

process safeguards such as access to the 

proposed registry and open negotiation, 

the Departments are of the view that a 

payment of a reduced administrative fee 

for non-initiating parties is appropriate, 

even in disputes that are not eligible for 

the Federal IDR process. The 

Departments recognize that the 

timelines described in this proposed 

policy may place additional burden on 

resource constrained small entities. 

However, the Departments believe that 

any additional burden to small entities 

will be significantly outweighed by the 

additional benefits to small entities from 

the proposed policies regarding low 

dollar and ineligible disputes. 

9. Extension of Time Periods for 

Extenuating Circumstances (26 CFR 

54.9816–8(g), 29 CFR 2590.716–8(g), 

and 45 CFR 149.510(g)) 

Under the proposed amendments to 

26 CFR 54.9816–8(g), 29 CFR 2590.716– 

8(g), and 45 CFR 149.510(g), the 

Departments would provide an 

extension of the time periods associated 

with the Federal IDR process if they 

identify unforeseen or good cause 

delays on a case-by-case basis, as 

opposed to solely relying on one of the 

parties to submit an extension request. 

Further, the Departments also propose 

to codify a generally applicable 

extension of time periods when the 

Departments determine that such 

extension is necessary due to 

extenuating circumstances that 

contribute to systematic delays in 

processing disputes under the Federal 

IDR process, such as an unforeseen high 

volume of disputes or Federal IDR 

portal system failures. 

The Departments considered 

alternatives to these proposals, 

including maintaining the status quo 

and not proposing to modify the ability 

of the Departments to provide 

extensions on a case-by-case basis or for 

generally applicable extensions of time 

periods. Additionally, the Departments 

considered only proposing the former, 

and not proposing to codify generally 

applicable extensions. However, the 

Departments are of the view that both 

proposed pathways to granting 

extensions of time periods for 

extenuating circumstances are relevant 

and necessary for the parties and 

entities participating in the Federal IDR 

process. In particular, the Departments 

are of the view that the ability to grant 

generally applicable extensions of time 

periods due to extenuating 

circumstances that contribute to 

systematic delays would provide 

protection for parties engaged in the 

Federal IDR process from the impact of 

systematic processing delays and ensure 

that unforeseen circumstances do not 

unfairly disadvantage a party or hinder 

its ability to comply with the Federal 

IDR process timeframes. Furthermore, 

the Departments believe that these 

additional protections may be especially 

beneficial to small entities, which may 

face difficulty in complying with the 

timelines proposed in this rulemaking. 

This proposed policy may partially 

offset the additional timeframe 

compliance burden placed on small 

entities, as described throughout this 

section, by providing greater flexibility 

in obtaining extensions in extenuating 

circumstances. 


lotter on DSK11XQN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75833 

209 Id. 

10. Registration of Group Health Plans 

and Health Insurance Issuers (26 CFR 

54.9816–9, 29 CFR 2590.716–9, and 45 

CFR 149.530) 

These proposed rules would require 

plans and issuers to submit certain 

information to the Departments within 

30 business days after the effective date 

of the final rules through an IDR 

registration process, and would make 

the resulting registry of plans and 

issuers available to parties initiating 

open negotiation requests or disputes 

through the Federal IDR portal. The 

Departments also recognize that this 

proposed policy may impose additional 

burden on resource constrained small 

entities by requiring them to submit 

additional information to the 

Departments. The Departments 

considered limiting registration 

information to a plan’s or issuer’s 

contact information and plan type (for 

example, fully-insured, self-insured, 

etc.). However, the Departments are of 

the view that this limited set of 

information would be insufficient to 

allow providers, facilities, and providers 

of air ambulances to initiate open 

negotiation and disputes correctly. For 

example, if a plan submitted 

information that it was self-insured but 

did not submit information showing 

that it had opted into a specified State 

law, a provider might incorrectly 

initiate a payment dispute in the 

Federal IDR process rather than the 

relevant State process. The Departments 

also considered requiring more 

comprehensive registration information, 

including a list of items and services 

that the plan covers which would be 

subject to a specified State law or AllPayer Model Agreement. The 

Departments are of the view that this 

level of detail would be overly 

burdensome on plans and issuers. 

Additionally, since States regularly 

modify the requirements of their 

specified State laws and All-Payer 

Model Agreements, the information 

contained in the registry would 

frequently be out-of-date. The 

Departments also considered allowing 

plans and issuers a period of one year 

following the rules’ effective date to 

register; however, the Departments are 

of the view that since plans and issuers 

are already required to disclose most of 

the proposed registration information, 

requiring registration by 30 business 

days after the rules’ effective date would 

not be unduly burdensome. 

F. Paperwork Reduction Act— 

Department of Health and Human 

Services, Department of Labor, and 

Department of the Treasury 

Under the Paperwork Reduction Act 

of 1995 (PRA), the Departments are 

required to provide 60-day notice in the 

Federal Register and solicit public 

comment before a collection of 

information requirement is submitted to 

OMB for review and approval. To fairly 

evaluate whether an information 

collection should be approved by OMB, 

section 3506(c)(2)(A) of the PRA 

requires that the Departments solicit 

comment on the following issues: 

• The need for information collection 

and its usefulness in carrying out the 

proper functions of the Departments. 

• The accuracy of the Departments’ 

estimate of the information collection 

burden. 

• The quality, utility, and clarity of 

the information to be collected. 

• Recommendations to minimize the 

information collection burden on the 

affected public, including automated 

collection techniques. 

1. Wage Estimates 

To derive wage estimates, the 

Departments generally used data from 

the Bureau of Labor Statistics to derive 

average labor costs (including a 100 

percent increase for fringe benefits and 

overhead) for estimating the burden 

associated with the information 

collection requirements (ICRs).209 Table 

9 presents the mean hourly wage, the 

cost of fringe benefits and overhead, and 

the adjusted hourly wage from the May 

2022 National Occupational 

Employment and Wage Estimates 

(https://www.bls.gov/oes/current/oes_

nat.htm). 

As indicated, employee hourly wage 

estimates have been adjusted by a factor 

of 100 percent. This is necessarily a 

rough adjustment, both because fringe 

benefits and overhead costs vary 

significantly across employers and 

because methods of estimating these 

costs vary widely across studies. 

2. ICRs Regarding Information To Be 

Shared About the QPA (26 CFR 

54.9816–6(d), 29 CFR 2590.716–6(d), 

and 45 CFR 149.140(d)) 

The July 2021 interim final rules, as 

updated by the August 2022 final rules, 

require plans and issuers to provide 

certain information regarding the QPA 

to providers, facilities, and providers of 

air ambulance services when making an 

initial payment or notice of denial of 

payment when the QPA is the 

recognized amount (or, for air 

ambulance services, the amount on 

which cost sharing is based). 

These proposed rules would require 

plans and issuers to disclose the legal 

business name of the group health plan 

(if any) or issuer; the legal business 

name of the plan sponsor (if applicable); 

and the assigned Federal IDR 

registration number (if the plan or issuer 

is registered with the Federal IDR 


lotter on DSK11XQN23PROD with PROPOSALS2EP03NO23.013</GPH>

TABLE 9: Adjusted Hourly Wages Used in Burden Estimates 

Occupational Mean Hourly Fringe Benefits Adjusted 

Occupation Title Code Wage ($/hour) and Overhead Hourly Wage 

($/hour) ($/hour) 

Computer Programmers 15-1251 $49.42 $49.42 $98.84 

General and Operations Manager 11-1021 $59.07 $59.07 $118.14 

Secretaries and Administrative Assistants, 43-6014 $20.87 $20.87 $41.74 

Except Legal, Medical, and Executive 

Compensation and Benefits Manager 11-3111 $68.82 $68.82 $137.64 

Medical and Health Services Manager 11-91 11 $61.53 $61.53 $123.06 

Office Clerk 43-9061 $19.78 $19.78 $39.56 
75834 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

210OMB Control Number: 0938–1401 (CMS– 

10780, Requirements Related to Surprise Billing: 

Qualifying Payment Amount, Notice and Consent, 

Disclosure on Patient Protections Against Balance 

Billing, and State Law Opt-in). 

registry). In addition, these proposed 

rules would amend the statement 

required under 26 CFR 54.9816– 

6(d)(1)(iv), 29 CFR 2590.716–6(d)(1)(iv), 

and 45 CFR 149.140(d)(1)(iv) to make 

technical and conforming changes to the 

content of the statement. 

The Departments assume that TPAs 

would provide this information on 

behalf of the self-insured plans they 

administer. The Departments assume 

that issuers and TPAs would automate 

the process of preparing and providing 

this information to providers, facilities, 

and providers of air ambulance services. 

The Departments anticipate that issuers 

and TPAs would need to make a onetime change to their IT systems to make 

changes to the currently required QPA 

notification to incorporate the proposed 

information described in the proposed 

new paragraph (d)(1)(v) and paragraph 

(d)(1)(iv). The Departments estimate that 

for each plan and issuer, on average, it 

would take a computer programmer 3 

hours (at an hourly rate of $98.84) to 

add fillable fields to disclose the legal 

business name (if any) of the group 

health plan or issuer; the legal business 

name of the plan sponsor (if applicable) 

and the assigned Federal IDR 

registration number (if the plan or issuer 

is registered with the Federal IDR 

registry); to add information notifying 

the provider, facility, or provider of air 

ambulance services of the proposed 

requirement to notify the Departments 

to initiate open negotiation; and to 

replace the phrase ‘‘amount of total 

payment’’ with the term ‘‘out-ofnetwork rate’’ and the term 

‘‘determination’’ with the phrase 

‘‘agreement on the amount of payment’’ 

in the statement about initiating open 

negotiation. The Departments estimate 

that the one-time burden for each plan 

or issuer, to be incurred in 2024, would 

be 3 hours on average, with an 

equivalent cost of approximately $297. 

The Departments estimate a total onetime burden, for all issuers and TPAs, 

of 5,115 hours, with an associated cost 

of approximately $505,567. As the 

Departments share jurisdiction, HHS 

would account for 50 percent of the 

total burden, or approximately 2,558 

burden hours, with an equivalent cost of 

approximately $252,783. The 

Departments of Labor and the Treasury 

would each account for 25 percent of 

the total burden, or approximately 1,279 

burden hours, with an equivalent cost of 

approximately $126,392. The 

Departments seek comment on these 

burden estimates. 

In addition, the Departments propose 

to revise the regulation addressing 

information to be shared about the QPA 

to make clear these disclosures are 

required when the recognized amount 

(or for air ambulance services, the 

amount on which cost sharing is based) 

is the QPA or the amount billed by the 

provider, facility, or provider of air 

ambulance services. The Departments 

anticipate that this is not a common 

occurrence and therefore would not 

result in an increase in burden for plans 

and issuers. 

The Departments would revise the 

information collection currently 

approved under OMB control number 

0938–1401 to account for this new 

burden.210

3. ICRs Regarding Open Negotiation (26 

CFR 54.9816–8(b)(1), 29 CFR 2590.716– 

8(b)(1), and 45 CFR 149.510(b)(1)) 

The Departments propose to require a 

party to provide an open negotiation 

notice containing additional required 

elements and supporting documentation 

to the other party and the Departments 

to initiate the open negotiation period. 

The October 2021 interim final rules 

established that the initiating party must 

provide an open negotiation notice to 

the other party which must include 

information sufficient to identify the 

items or services subject to negotiation, 

including the date(s) the item(s) or 

service(s) were furnished, the service 

code, and initial payment amount, if 

applicable), an offer of an out-ofnetwork rate, and contact information 

for the party sending the open 

negotiation notice. The provisions in 

these proposed rules would expand the 

required information in an open 

negotiation notice to include 12 new 

content additions to the existing 

required elements. The expanded 

content requirements would include: (1) 

information sufficient to identify the 

provider, facility or provider of air 

ambulance services, including name 

and current contact information 

(including the legal business name, 

email address, phone number, and 

mailing address) and the National 

Provider Identifier (NPI); (2) the plan’s 

or issuer’s registration number as 

required under 26 CFR 54.9816–9, 29 

CFR 2590.716–9, and 45 CFR 149.530 (if 

the plan or issuer is not registered under 

26 CFR 54.9816–9, 29 CFR 2590.716–9, 

and 45 CFR 149.530, an attestation by 

the party submitting the open 

negotiation notice that the plan or issuer 

was not registered by the date it 

submitted the open negotiation notice), 

the legal business name of the plan or 

issuer as well as the current contact 

information (name, email address, 

phone number, and mailing address) of 

the plan or issuer as provided with the 

initial payment or notice of denial of 

payment, and if the party submitting the 

open negotiation notice is a plan or 

issuer, the plan type (for example, selfinsured or fully-insured); (3) the name 


lotter on DSK11XQN23PROD with PROPOSALS2EP03NO23.014</GPH>

TABLE 10: One-Time IT Burden and Cost for Plans and Issuers to Incorporate 

Information Related to QPA to Providers, Facilities, and Providers of Air Ambulance 

Services 

Year Department Estimated Estimated Burden per Total Total 

Number of Number of Response Annual Estimated 

Respondents Responses (Hours) Burden Cost 

(Hours) 

HHS 853 853 3 2,557.5 $252,783 

2024 Labor 426 426 3 1,278.8 $126,392 

Treasury 426 426 3 1,278.8 $126,392 
Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75835 

211 86 FR 56056. 

and contact information including the 

legal business name, email address, 

phone number, and mailing address for 

any third party representing the party 

submitting the open negotiation notice 

and an attestation that the third party 

has the authority to act on behalf of the 

party it represents in the open 

negotiation; (4) information sufficient to 

identify the item or service, including, 

but not limited to: the date(s) the item 

or service was furnished and the date(s) 

that the provider, facility, or provider of 

air ambulance services received the 

initial payment or notice of denial of 

payment for such item or service from 

the plan or issuer; the type of item or 

service including, whether the item or 

service is an emergency service as 

defined in 26 CFR 54.9816–4T(c)(2), 29 

CFR 2590.716–4(c)(2), and 45 CFR 

149.110(c)(2), non-emergency times and 

services as described in 26 CFR 

54.9816–5T(b), 29 CFR 2590.716–5(b), 

and 45 CFR 149.120(b); or an air 

ambulance service as defined in 26 CFR 

54.9816–3T, 29 CFR 2590.716–3, and 45 

CFR 149.30; whether the service is a 

professional service or facility-based 

service; the State where the item or 

service was furnished; the claim 

number; the service code; and 

information sufficient to identify the 

location the item of service was 

furnished (such as place of service code 

or bill type); (5) the initial payment 

amount (including $0 if, for example, 

payment is denied); (6) the QPA if 

provided with the initial payment or 

denial of payment; (7) an offer of an outof-network rate for each item or service; 

(8) if the party submitting the open 

negotiation notice is a plan or issuer, the 

amount of cost sharing imposed for the 

item or service; (9) if the party 

submitting the open negotiation notice 

is a provider or facility, a statement that 

the patient who received the item or 

service did not receive notice or provide 

consent as described in 45 CFR 

149.410(b) or 149.420(c) through (i) to 

be treated by a nonparticipating 

provider or nonparticipating emergency 

facility; (10) a statement that the 

provider, facility, or provider of air 

ambulance services was a 

nonparticipating provider, 

nonparticipating emergency facility, or 

nonparticipating provider of air 

ambulance services on the date the item 

or service was furnished; (11) general 

information listed in the standard open 

negotiation notice developed by the 

Departments describing the open 

negotiation period and the Federal IDR 

process (including a description of the 

purpose of the open negotiation period 

and Federal IDR process and key 

deadlines in the open negotiation period 

and Federal IDR process); and (12) a 

copy of the initial payment or notice of 

denial of payment or other remittance 

advice that is required to include the 

disclosures under 26 CFR 54.9816– 

6T(d)(1), 29 CFR 2590.716–6(d)(1), and 

45 CFR 149.140(d)(1) for the item or 

service. 

Furthermore, the Departments 

propose that the party in receipt of the 

open negotiation notice would be 

required to provide a response to the 

open negotiation notice through the 

Federal IDR portal no later than the 15th 

business day of the 30-business-day 

open negotiation period. The proposed 

open negotiation response notice would 

require the following categories of 

information, beginning with the same 

information as specified in proposed 26 

CFR 54.9816–8(b)(1)(ii)(A)(1) through 

(3), 29 CFR 2590.716–8(b)(1)(ii)(A)(1) 

through (3), and 45 CFR 45 CFR 

149.510(b)(1)(ii)(A)(1) through (3) 

related to the requirements to provide 

contact information for the provider, 

facility, or provider of air ambulance 

services, and the plan or issuer that is 

a party to the open negotiation, and any 

third party representing a party in the 

open negotiation. It would also include 

(4) information sufficient to identify 

each item or service included in the 

open negotiation notice, including the 

date(s) the item or service was furnished 

and the date(s) that the provider, 

facility, or provider of air ambulance 

services received the initial payment or 

notice of denial of payment for such 

item or service from the plan or issuer 

and the claim number; (5) if the party 

in receipt of the open negotiation notice 

is a plan or issuer, a statement as to 

whether the party in receipt of the open 

negotiation notice agrees that the initial 

payment amount (including $0 if, for 

example, payment is denied) and the 

QPA reflected in the open negotiation 

notice is accurate for the item or service, 

and if not, or if the open negotiation 

notice indicated that the initial payment 

amount or qualifying payment amount 

was not communicated by the plan or 

issuer with the initial payment or notice 

of denial of payment or other remittance 

advice, the initial payment amount 

(including $0 if, for example, payment 

is denied) and/or QPA amount it 

believes to be correct and 

documentation to support the statement; 

(6) if the party in receipt of the open 

negotiation notice is a plan or issuer, the 

amount of cost sharing imposed for the 

item or service; (7) a counteroffer of an 

out-of-network rate for the item or 

service or an acceptance of the other 

party’s offer; (8) if the party in receipt 

of the open negotiation notice is a 

provider or facility, a statement that the 

patient who received the item or service 

did not receive notice or provide 

consent to be treated by a 

nonparticipating provider or 

nonparticipating emergency facility as 

described in 149.410(b) or 149.420(c) 

through (i); (9) with respect to each item 

or service, either a statement and 

supporting documentation that notes 

why the item or service is ineligible for 

the Federal IDR process or a statement 

agreeing that the item or service is 

eligible for the Federal IDR process; (10) 

a statement as to whether any of the 

information provided in the open 

negotiation notice is inaccurate and the 

basis for the assertion; and (11) a 

statement confirming that the initial 

payment or notice of denial of payment 

or other remittance advice provided 

with the open negotiation notice is 

accurate, and if inaccurate, a copy of the 

initial payment or notice of denial of 

payment or other remittance advice that 

are required to include the disclosures 

under 26 CFR 54.9816–6T(d)(1), 29 CFR 

2590.716–6(d)(1), and 45 CFR 

149.140(d)(1), for the item or service. 

In addition to the paperwork costs for 

the Federal IDR process previously 

accounted for in the July 2021 interim 

final rules and October 2021 interim 

final rules, the Departments estimate 

that it would take a compensation and 

benefits manager 30 minutes (at an 

hourly rate of $137.64) and an office 

clerk 15 minutes (at an hourly rate of 

$39.56) on average to prepare and 

submit the additional information for 

open negotiation for each plan, issuer, 

or FEHB carrier and provider or facility 

initiating open negotiation. This results 

in a cost of $78.71 per party per open 

negotiation notice. Similarly, the 

Departments estimate that it would take 

a compensation and benefits manager 30 

minutes (at an hourly rate or $137.64) 

and an office clerk 15 minutes (at an 

hourly rate of $39.56) on average to 

prepare and submit the proposed open 

negotiation response notice for each 

party in receipt of the open negotiation 

notice, resulting in a cost of $78.71 per 

party per open negotiation response 

notice. In the October 2021 interim final 

rules, the Departments originally 

estimated that 25 percent of disputes 

would be resolved in open negotiation 

before entering the Federal IDR 

process.211 The Departments request 

data or comments on whether this 

assumption has been proven correct. 

Accordingly, the Departments estimate 

that 560,000 disputes per year would go 

through open negotiation, requiring 


lotter on DSK11XQN23PROD with PROPOSALS2
75836 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

212As the Departments do not anticipate these 

proposed rules would be finalized and effective 

before July 1, 2024, the burden for 2024 would be 

prorated to 50 percent, or 420,000 hours with an 

equivalent cost of $44,079,000. 

213OMB Control Number: 1210–0169 (No 

Surprises Act: IDR Process). 

560,000 initiating parties to prepare and 

submit the additional materials 

proposed for the open negotiation notice 

and 560,000 non-initiating parties to 

prepare and submit the additional 

materials proposed for the open 

negotiation notice response notice. At a 

cost of $78.71 ($68.82 for 30 minutes by 

the compensation and benefits manager 

and $9.89 for 15 minutes by the office 

clerk, or a combined hourly rate of 

$104.95) per party per dispute, this 

results in a total annual hour burden of 

840,000 hours with an equivalent cost of 

approximately $88,158,000 for 560,000 

disputes annually beginning in 2025.212

As the Departments and OPM share 

jurisdiction, HHS would account for 45 

percent of the total burden, or 

approximately 378,000 burden hours, 

with an equivalent cost of 

approximately $39,671,100. The 

Departments of Labor and the Treasury 

would each account for 25 percent of 

the total burden, or approximately 

210,000 burden hours, with an 

equivalent cost of approximately 

$22,039,500. OPM would account for 5 

percent of the total burden, or 

approximately 42,000 burden hours, 

with an equivalent cost of 

approximately $4,407,900. The 

Departments seek comment on these 

assumptions. 

The Departments would revise the 

information collection currently 

approved under OMB control number 

1210–0169 to account for this new 

burden.213

4. ICRs Regarding Initiating the Federal 

IDR Process and the Notice of IDR 

Initiation (26 CFR 54.9816–8(b)(2), 29 

CFR 2590.716–8(b)(2), and 45 CFR 

149.510(b)(2)) 

a. Notice of IDR Initiation and Notice of 

IDR Initiation Response 

To initiate the Federal IDR process, 

the initiating party must submit a 

written notice of IDR initiation to the 

non-initiating party and to the 

Departments (using the standard form 

developed by the Departments) during 

the 4-business-day period beginning on 

the first business day after the close of 

the 30-business-day open negotiation 

period. The Departments propose to add 

additional required elements under the 

8 categories to the existing required 

information in the written notice of IDR 

initiation: (1) information sufficient to 

identify the initiating party, including 

the TIN, the NPI of the provider, facility, 

or provider of air ambulance services (if 

available), the plan’s or issuer’s 

registration number, if the plan or issuer 

is registered under 26 CFR 54.9816–9, 

29 CFR 2590.716–9, and 45 CFR 

149.530, and if the initiating party is a 

plan or issuer, the plan type; (2) the 

name and contact information for any 

third party representing the initiating 

party and an attestation that the third 

party has the authority to act on behalf 

of the party it represents in the Federal 

IDR process; (3) information sufficient 

to identify whether the dispute being 

initiated includes batched or bundled 

qualified IDR items or services; (4) 

information sufficient to identify the 

item or service included in the notice of 

IDR initiation, including the date(s) the 

item or service was furnished. If the 

initiating party is a provider, facility, or 

provider of air ambulances, the date(s) 

the provider, facility, or air ambulance 

provider received the initial payment or 

denial of payment, the date the open 

negotiation period began, the type of 

item or service, whether the service is 

a professional or service or facilitybased service, the State where the item 

or service was furnished, the claim 

number, service code and information to 

identify the location the service was 

furnished (including place of service or 

bill type code); (5) if the non-initiating 

party is a plan or issuer, a statement that 

the provider, facility, or air ambulance 

provider was a nonparticipating 

provider, facility, or air ambulance 

provider; (6) an attestation that the item 

or service is a qualified IDR item or 

service and the basis for the attestation; 

(7) a copy of the initial payment or 

notice of denial of payment or other 

remittance advice that is required to 

include the disclosures under 26 CFR 

54.9816–6T(d)(1), 29 CFR 2590.716– 

6(d)(1), and 45 CFR 149.140(d)(1), with 

respect to the item or service; and (8) a 

statement describing the key aspects of 

the claim, such as patient acuity or level 

of training of the provider, facility, or 

provider of air ambulance services that 

furnished the qualified IDR item or 

service, discussed by the parties during 

open negotiation that relate to the 

payment for the disputed claim, 

whether the reasons for initiating the 

Federal IDR process are different from 

the aspects of the claim discussed 

during the open negotiation period, and 

an explanation of why the party is 

initiating the Federal IDR process. 

The Departments also propose that 

the non-initiating party must submit a 

written response to the notice of IDR 

initiation to the initiating party and to 

the Departments during the 3-businessday period beginning on the day after 

the notice of IDR initiation is received 

by the Departments. This proposed IDR 

initiation response notice would require 

the following information: (1) 

information sufficient to identify the 

provider, facility, or provider of air 

ambulance services, including name 

and current contact information 

(including the legal business name, 

email address, phone number, and 

mailing address), the TIN, the NPI of the 


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TABLE 11: Annual Burden and Cost for Open Negotiation 

Estimated Estimated Burden 

Department Number of Number of per Total Annual Total Estimated Cost Response Burden (Hours) Respondents Responses (Hours) 

HHS 472,500 472,500 0.75 378,000 $39,671,100 

Labor 262,500 262,500 0.75 210,000 $22,039,500 

Treasury 262,500 262,500 0.75 210,000 $22,039,500 

OPM 52,500 52,500 0.75 42,000 $4,407,900 
Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75837 

214As the Departments do not anticipate these 

proposed rules would be finalized and effective 

before July 1, 2024, the burden for 2024 would be prorated to 50 percent, or 315,000 hours with an 

equivalent cost of $33,059,250. 

provider, facility, or provider of air 

ambulance services, (2) information 

sufficient to identify the plan or issuer 

including the plan’s or issuer’s 

registration number, as required under 

26 CFR 54.9816–9, 29 CFR 2590.716–9, 

and 45 CFR 149.530 or an attestation 

from the non-initiating party that the 

plan or issuer was not registered prior 

to the date that it submitted the notice, 

the legal business name of the plan or 

issuer, as well as the current contact 

information (name, email address, 

phone number, and mailing address) of 

the plan or issuer as provided with the 

initial payment or notice of denial of 

payment; and if the party submitting the 

notice of IDR initiation response is a 

plan or issuer, the plan type (for 

example, self-insured or fully-insured) 

and TIN (or, in the case of a plan that 

does not have a TIN, the TIN of the plan 

sponsor); (3) the name and contact 

information for any third party 

representing the non-initiating party 

and an attestation that the third party 

has the authority to act on behalf of the 

party it represents in the Federal IDR 

process; (4) information sufficient to 

identify each item or service (including 

the date(s) the item or service was 

furnished, if the non-initiating party is 

a provider, facility, or provider of air 

ambulance services, the date(s) that the 

provider, facility, or provider of air 

ambulance services received the initial 

payment or notice of denial of payment 

for such item or service from the plan 

or issuer, and the claim number); (5) if 

the non-initiating party is a plan or 

issuer, a statement as to whether the 

non-initiating party agrees that the 

initial payment (including $0 if, for 

example, payment is denied) and the 

QPA reflected in the notice of IDR 

initiation is accurate and if not, an 

assertion of the correct initial payment 

amount and/or the QPA that was 

disclosed with the initial payment or 

notice of denial of payment for the item 

or service and documentation to support 

the assertion; (6) if the non-initiating 

party is a plan or issuer, the amount of 

cost sharing imposed for the item or 

service; (7) if the non-initiating party is 

a provider or facility, a statement that 

the items and services do not qualify for 

the notice and consent exception 

described at CFR 149.410(b) or 

149.420(c); (8) for each item or service 

subject to the dispute, an attestation that 

the item or service that is the subject of 

the dispute is a qualified IDR item or 

service, and for each item or service that 

the non-initiating party attests is not a 

qualified IDR item or service, an 

explanation and supporting 

documentation; (9) a statement 

confirming that the initial payment or 

notice of denial of payment or other 

remittance advice provided by the 

initiating party under paragraph 

(b)(2)(ii)(A)(12) is accurate, and if 

inaccurate, a copy of the remittance 

advice or other documentation required 

to include the disclosures under 26 CFR 

54.9816–6T(d)(1), 29 CFR 2590.716– 

6(d)(1), and 45 CFR 149.140(d)(1), with 

respect to the item or service; (10) a 

statement as to whether any of the 

information provided in the notice of 

IDR initiation is inaccurate and the basis 

for the statement as well as any 

supporting documentation; and (11) a 

statement as to whether the noninitiating party agrees or objects to the 

initiating party’s preferred certified IDR 

entity and if the party objects, an 

alternative preferred certified IDR 

entity. 

In addition to the paperwork costs for 

the Federal IDR process, the 

Departments estimate that it would take 

a compensation and benefits manager 30 

minutes (at an hourly rate of $137.64) 

and an office clerk 15 minutes (at an 

hourly rate of $39.56) on average to 

prepare and submit the additional 

statements proposed for the notice of 

IDR initiation for each initiating party, 

resulting in a cost of $78.71 per party 

per notice of IDR initiation. Similarly, 

the Departments estimate that it would 

take a compensation and benefits 

manager 30 minutes (at an hourly rate 

of $137.64) and an office clerk 15 

minutes (at an hourly rate of $39.56) on 

average to prepare and submit the 

proposed notice of IDR initiation 

response for each non-initiating party, 

resulting in a cost of $78.71 per party 

per notice of IDR initiation response. 

The Departments estimate that 420,000 

disputes would be initiated, requiring 

work by 840,000 disputing parties. At a 

per party cost of $78.71 ($68.82 for 30 

minutes by the compensation and 

benefits manager at $137.64 per hour 

and $9.89 for 15 minutes by the office 

clerk at $39.56 per hour, or a combined 

hourly rate of $104.95) per party, this 

results in a total estimated annual hour 

burden of 630,000 hours or an 

equivalent cost burden of $66,118,500 

for 420,000 disputes, which includes 

315,000 estimated annual burden hours 

or an equivalent annual cost burden of 

$33,059,250 each for initiating and noninitiating parties, respectively, 

beginning in 2025.214 As the 

Departments and OPM share 

jurisdictions, HHS would account for 45 

percent of the total burden, or 

approximately 283,500 burden hours, 

with an equivalent cost of 

approximately $29,753,325. The 

Departments of Labor and the Treasury 

would each account for 25 percent of 

the total burden, or approximately 

157,500 burden hours, with an 

equivalent cost of approximately 

$16,529,625. OPM would account for 5 

percent of the total burden, or 

approximately 31,500 burden hours, 

with an equivalent cost of 

approximately $3,305,925. The 

Departments seek comment on these 

assumptions. 


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TABLE 12: Annual Burden and Cost for Notice oflDR Initiation 

Estimated Estimated Burden Total Annual 

Department Number of Number of per Burden Total Estimated Cost Response Respondents Responses (Hours) (Hours) 

HHS 378,000 378,000 0.75 283,500 $29,753,325 

DOL 210,000 210,000 0.75 157,500 $16,529,625 

Treasury 210,000 210,000 0.75 157,500 $16,529,625 

OPM 42,000 42,000 0.75 31,500 $3,305,925 
75838 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

215OMB Control Number: 1210–0169 (No 

Surprises Act: IDR Process). 

216The Departments assume that it will take 1 

hour for a medical and health services professional 

to write the notice and 15 minutes for a clerical 

worker to prepare and send the notice at a wage rate 

of $109.03 per hour for the medical and health 

services manager and a wage rate of $58.66 per hour 

for the clerical worker. 

217The is calculated as follows: 113,400 disputes 

× 0.5 hours = 56,700 burden hours. 56,700 burden 

hours × $39.56 hourly rate = $2,243,052 total 

annual cost. 

218 Internal data show that the highest number of 

times a certified IDR entity was selected for a single 

dispute was five. Since these proposed rules would 

amend the frequency of use of the notice of certified 

IDR entity selection by transferring one of the 

selection instances to the notice of IDR initiation, 

five unique selections would correspond to four 

exchanges of the notice of certified IDR entity 

selection. However, the Departments anticipate that 

four exchanges would be quite rare based on 

internal data, so the Departments are using two 

exchanges of the notice of certified IDR entity 

selection in these estimates. The Departments seek 

comment on these assumptions. 

219This is calculated as follows: 8,400 disputes × 

0.5 hours × 2 exchanges = 8,400 burden hours. 

8,400 burden hours × $39.56 hourly rate = $332,304 

total annual cost. 

220The precise unrounded number for the 

weighted average time per response is 0.53448 

hours. This unrounded number is used to calculate 

the total annual burden across the disputes 

requiring the submission of a certified IDR entity 

selection notice. The calculation is as follows: 

0.53448 weighted average time per response × 

121,800 disputes = 65,100 total annual burden 

hours. 

221This is calculated as follows: 0.53 hours × 

$39.56 hourly rate = $21.14 cost per response. 

The Departments would revise the 

information collection currently 

approved under OMB control number 

1210–0169 to account for the new 

burden.215

b. Preliminary Selection of the Certified 

IDR Entity 

The Departments anticipate that the 

amendments to the process for the 

preliminary selection of the certified 

IDR entity would reduce the overall 

burden associated with collecting 

information through the notice of 

certified IDR entity selection. In these 

proposed rules, the Departments 

propose that the non-initiating party 

must agree or object to the preferred 

certified IDR entity in the notice of IDR 

initiation response. Accordingly, the 

initiating party would only be required 

to submit the notice of certified IDR 

entity selection if the non-initiating 

party objects to the initiating party’s 

preferred certified IDR entity and 

submits an alternative preferred 

certified IDR entity in the notice of IDR 

initiation response, thus limiting the 

frequency with which the Departments 

expect the initiating party to submit this 

information. Similarly, the noninitiating party would only be required 

to use the notice of certified IDR entity 

selection if the non-initiating party 

objected to the initiating party’s 

alternative preferred certified IDR entity 

included in the initiating party’s notice 

of certified IDR selection form. The 

content submitted through the notice 

would also be streamlined to only 

reflect information confirming the 

party’s agreement or objection, preferred 

alternative to other party’s alternative 

preferred certified IDR entity, and if 

applicable, an explanation of the 

conflict of interest with the alternative 

preferred certified IDR entity. 

Under the current rules and currently 

approved PRA package (OMB control 

number 1210–0169), the Departments 

assume that all disputes require the 

submission of the notice of certified IDR 

entity selection, and that each notice 

corresponds to approximately 1.25 

burden hours, with an equivalent cost of 

$119.216 Across all disputes, the 

Departments assume an annual burden 

of approximately 21,794 hours at a cost 

of approximately $2,156,635 for parties 

to submit the notice of certified IDR 

entity selection. However, based on 

these proposed rules, the Departments 

anticipate that the frequency and 

content of this collection would change, 

thus impacting the currently estimated 

burden. 

Under these proposed rules, this 

information collection would be limited 

to those disputes in which either party 

does not agree to the other party’s 

preferred alternative certified IDR 

entity. For this subset of disputes, the 

initiating party would be required to 

submit the notice of certified IDR entity 

selection to indicate agreement or 

objection to the non-initiating party’s 

alternate preferred certified IDR entity 

selection as indicated in the notice of 

IDR initiation response, and both parties 

would have the ability to submit the 

notice back-and-forth during the 3-day 

period after the date of IDR initiation 

until an agreed upon entity is identified 

or the parties fail to jointly agree. The 

content of the collection would be 

revised to only require a party to 

indicate their agreement or objection 

and if applicable an explanation of the 

conflict of interest, and identification of 

an alternate preferred certified IDR 

entity and thus the Departments 

anticipate that it would take a 

respondent much less time to submit 

this information than previously 

estimated. 

Based on internal data, in 

approximately 29 percent of disputes, 

the non-initiating party objects to the 

certified IDR entity selected by the 

initiating party. Further, out of the 29 

percent of disputes in which the noninitiating party objected to the certified 

IDR entity selected by the initiating 

party, the majority of those disputes (93 

percent, or 27 percent of all disputes) 

the initiating party agreed to the 

alternate preferred certified IDR entity 

selected by the non-initiating party. In 

a very small percentage (approximately 

2 percent) of disputes, the non-initiating 

party and initiating party engage in a 

back-and-forth by objecting to each 

other’s preferred certified IDR entities 

multiple times. Based on the number of 

disputes submitted from June 2022 

through June 2023, the Departments 

estimate that approximately 113,400 

disputes would require the initiating 

party to submit a notice of certified IDR 

entity selection form a single time. The 

Departments estimate that it would take 

an office clerk 30 minutes (at an hourly 

rate of $39.56) on average to prepare and 

submit the notice indicating agreement 

or objection to the alternate preferred 

certified IDR entity and selecting an 

alternative entity, if applicable. This 

would result in a cost of $19.78 per 

dispute. For the approximately 113,400 

disputes that would require this 

collection, the total annual hourly 

burden would be 56,700 hours, with an 

equivalent annual cost of approximately 

$2,243,052.217

In addition, the Departments expect 

that, for a small proportion of disputes, 

the initiating party and the noninitiating party would exchange the 

notice of certified IDR entity selection 

multiple times within the proposed 

timeframe before reaching agreement 

and jointly selecting or defaulting to 

random selection. To reflect the 

additional burden associated with 

disputes requiring multiple notices, the 

Departments estimate that 

approximately 8,400 disputes would 

require the provision of two total rounds 

of notice exchange 218 by the initiating 

party and non-initiating party before 

either jointly selecting a certified IDR 

entity or defaulting to selection by the 

Departments. This would result in a cost 

of $39.56 per dispute, and a total annual 

hourly burden of 8,400 hours with an 

equivalent cost of $332,304.219

The Departments estimate that in total 

for disputes requiring this collection, 

including both the 113,400 disputes that 

the Departments anticipate would 

require a single submission of the notice 

of certified IDR entity selection form 

and the 8,400 disputes requiring 

multiple submissions of the form, the 

average burden per response would be 

approximately 0.53 hours 220 with an 

equivalent cost of approximately $21.14 

per response.221 Therefore, the total 

annual burden would be 65,100 hours, 

with an equivalent cost of 


lotter on DSK11XQN23PROD with PROPOSALS2
Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75839 

222As the Departments do not anticipate these 

proposed rules would be finalized and effective 

before July 1, 2024, the burden for 2024 would be 

prorated to 50 percent, or 32,550 hours with an 

equivalent cost of $1,287,678. 

223This is calculated as follows: $2,156,635 ¥ 

$2,575,256 = ¥$418,621. 

224This is calculated as follows: 0.25 hours per 

response × $137.64 hourly rate for a compensation 

and benefits manager = $34.41 per response. 0.25 

hours per response × $39.56 hourly rate for an office 

clerk = $9.89 per response. $34.41 + $9.89 = $44.30 

total per response. 

225This is calculated as follows: 16,800 disputes 

× 0.5 labor hours per dispute = 8,400 total burden 

hours. 16,800 disputes × $44.30 per dispute = 

$744,240 total cost. As the Departments do not 

anticipate these proposed rules would be finalized 

and effective before July 1, 2024, the burden for 

2024 would be prorated to 50 percent, or 4,200 

hours with an equivalent cost of $372,120. 

226This is calculated as follows: 0.25 hours per 

response × $39.56 hourly rate for an office clerk = 

$9.89 per response. 

$2,575,356.222 As the Departments and 

OPM share jurisdiction, HHS would 

account for 45 percent of the total 

burden, or approximately 29,295 burden 

hours, with an equivalent cost of 

approximately $1,158,910. The 

Departments of Labor and the Treasury 

would each account for 25 percent of 

the total burden, or approximately 

16,275 burden hours each, with an 

equivalent cost of approximately 

$643,839 each. OPM would account for 

5 percent of the total burden, or 

approximately 3,255 burden hours, with 

an equivalent cost of approximately 

$128,768. 

However, as discussed earlier in this 

section, as the current information 

collection assumes a burden per 

respondent of 1.25 hours and a total cost 

burden of $2,156,635, the Departments 

estimate a total increase in costs of 

approximately $418,621 223 due to the 

proposed changes to the requirement to 

submit this notice. The Departments 

seek comment on these assumptions. 

The Departments would revise the 

information collection currently 

approved under OMB control number 

1210–0169 to account for this revised 

burden. 

5. ICRs Regarding Federal IDR Eligibility 

Determinations (26 CFR 54.9816–8(c), 

29 CFR 2590.716–8(c), and 45 CFR 

149.510(c)) 

The Departments anticipate no change 

or nominal change in burden related to 

the proposed departmental eligibility 

review provision. This information 

collection is approved under OMB 

control number 1210–0169. The same 

type and quantity of information would 

continue to be collected from disputing 

parties to determine eligibility under 

these proposed rules. When the 

departmental eligibility review is in 

effect, the Departments would be 

collecting information related to Federal 

IDR dispute eligibility. When the 

departmental eligibility review is not in 

effect, the Departments and the certified 

IDR entities would be collecting this 

information. Therefore, the Departments 

are of the view that there is no change 

in burden associated with changing to 

whom the parties are submitting 

eligibility information. The Departments 

seek comment on these assumptions. 

6. ICRs Regarding Withdrawals (26 CFR 

54.9816–8(c)(3)(ii), 29 CFR 2590.716– 

8(c)(3)(ii), and 45 CFR 149.510(c)(3)(ii)) 

The Departments propose to add 26 

CFR 54.9816–8(c)(3)(ii), 29 CFR 

2590.716–8(c)(3)(ii), and 45 CFR 

149.510(c)(3)(ii) to establish a process 

for disputes to be withdrawn from the 

Federal IDR process. The proposed 

withdrawal process would require the 

creation of a new collection of 

information and increase burden on the 

initiating and non-initiating parties 

required to submit the proposed notice. 

These proposed rules would require the 

initiating party to submit a withdrawal 

request to the Departments and the noninitiating party through the Federal IDR 

portal. The non-initiating party would 

then be required to provide a response 

within 5 business days indicating 

agreement or objection to the request for 

withdrawal. Each dispute would 

therefore require a collection from both 

the initiating (requesting) and the noninitiating (responding) parties in order 

to withdraw. If the non-initiating party 

fails to respond, the non-initiating party 

would be considered to have agreed to 

the dispute’s withdrawal. The 

Departments expect that dispute 

withdrawals would be relatively rare: 

Based on internal data, the Departments 

anticipate that approximately 4 percent 

of disputes (or 16,800 disputes) would 

be withdrawn annually. 

The Departments estimate that it 

would take a compensation and benefits 

manager 15 minutes (at an hourly rate 

of $137.64) and an office clerk 15 

minutes (at an hourly rate of $39.56) for 

the initiating party to prepare and 

submit the notice of request for 

withdrawal to the non-initiating party 

and the Departments through the 

Federal IDR portal, resulting in a time 

of 30 minutes and cost of $44.30 per 

dispute for the initiating party.224 For 

the anticipated 16,800 withdrawn 

disputes annually, initiating parties 

would incur a total of 8,400 burden 

hours with an equivalent cost burden of 

$744,240 to submit withdrawal requests 

annually.225 Because the notice of 

withdrawal response would have fewer 

data elements and would require a 

lower amount of time and labor burden 

to submit, the Departments estimate that 

it would take an office clerk 

approximately 15 minutes (at an hourly 

rate of $39.56) on average for the noninitiating party to submit the notice of 

withdrawal response to the initiating 

party and the Departments through the 

Federal IDR portal, resulting in a cost of 

$9.89 per response.226 For the 

anticipated 16,800 withdrawn disputes 

annually, the non-initiating party would 


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TABLE 13: Annual Burden and Cost for Notice of Certified IDR Entity Selection Form 

Estimated Burden 

Department Number of Estimated Number per Total Annual Total Estimated 

of Responses Response Burden (Hours) Cost Respondents (Hours) 

HHS 44,370 44,370 0.53 29,295 $1,158,9IO 

Labor 24,650 24,650 0.53 16,275 $643,839 

Treasury 24,650 24,650 0.53 16,275 $643,839 

OPM 4,930 4,930 0.53 3,255 $128,768 
75840 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

227This is calculated as follows: 16,800 disputes 

× 0.25 labor hours per dispute = 4,200 total burden 

hours. 16,800 disputes × $9.89 = $166,152 total 

cost. As the Departments do not anticipate these 

proposed rules would be finalized and effective 

before July 1, 2024, the burden for 2024 would be 

prorated to 50 percent, or 2,100 hours with an 

equivalent cost of $83,076. 

228This is calculated as follows: 8,400 total 

initiating party burden hours + 4,200 total noninitiating party burden hours = 12,600 overall total 

burden hours. $744,240 total initiating party cost + 

$166,152 total non-initiating party cost = $910,392 

overall total cost. As the Departments do not 

anticipate these proposed rules would be finalized 

and effective before July 1, 2024, the burden for 

2024 would be prorated to 50 percent, or 6,300 

hours with an equivalent cost of $455,196. 

229OMB Control Number: 1210–0169 (No 

Surprises Act: IDR Process). The burden is 

estimated as follows: (18 hours × $39.56) = $712.08 

per certified IDR entity. A labor rate of $39.56 is 

used for a clerical worker (a secretary or 

administrative assistant, not including legal, 

medical, or executive). The labor rates are applied 

in the following calculation: (13 certified IDR 

entities × 18 hours × $39.56) = $9,257.04. 

incur a total of 4,200 burden hours or 

an equivalent cost burden of $166,152 to 

submit withdrawal responses 

annually.227 This results in a total 

estimated annual burden of 12,600 

hours or an equivalent cost burden of 

$910,392 across both the initiating and 

non-initiating parties.228

As the Departments and OPM share 

jurisdictions, HHS would account for 45 

percent of the total burden, or 

approximately 5,670 burden hours, with 

an equivalent cost of approximately 

$409,676. The Departments of Labor and 

the Treasury would each account for 25 

percent of the total burden, or 

approximately 3,150 burden hours, with 

an equivalent cost of approximately 

$227,598. OPM would account for 5 

percent of the total burden, or 

approximately 630 burden hours, with 

an equivalent cost of approximately 

$45,520. The Departments seek 

comment on these assumptions. 

The Departments would revise the 

information collection currently 

approved under OMB control number 

1210–0169 to account for this proposed 

burden. 

7. ICRs Regarding Administrative and 

Certified IDR Entity Fee Collection (26 

CFR 54.9816–8(d), 29 CFR 2590.716– 

8(d), and 45 CFR 149.510(d)) 

The Departments propose to allow for 

the administrative fee due from each 

party for participating in the Federal 

IDR process to be paid to the 

Departments. The burden currently 

associated with this requirement is the 

time and effort for a certified IDR entity 

to track payments made by disputing 

parties and submit the administrative 

fees to HHS upon invoice. In the No 

Surprises Act: IDR Process PRA 

package,229 the Departments estimated 

that tracking payments made by 

disputing parties and submitting the 

administrative fees to HHS upon invoice 

would take a clerical worker (a secretary 

or administrative assistant, not 

including legal, medical, or executive) 

approximately 18 hours annually (at a 

rate of $39.56 per hour). The 

Departments estimated that each 

certified IDR entity would incur a 

burden of 18 hours annually at a cost of 

approximately $711 per certified IDR 

entity to comply with the administrative 

fee reporting and submission 

requirements. 

Since this proposal would eliminate 

the requirement that certified IDR 

entities collect the administrative fee on 

behalf of the Departments, the 

Departments propose to rescind this 

information collection. The burden 

associated with this information 

collection estimated above would be 

removed if this proposal is finalized, 

since certified IDR entities would no 

longer be collecting the administrative 

fee moving forward. 

The Departments estimate a total 

burden reduction, for 13 certified IDR 

entities, of 234 hours, with an 

associated cost reduction of 

approximately $9,257 beginning in 

2025. As the Departments share 

jurisdiction, HHS would account for 45 

percent of the total burden reduction, or 

a reduction of approximately 108 

burden hours, with an equivalent cost 

reduction of approximately $4,272. The 

Departments of Labor and the Treasury 

would each account for 25 percent of 

the total burden reduction, or 

approximately 54 burden hours each, 

with an equivalent cost reduction of 

approximately $2,136. OPM would 

account for 5 percent of the total burden 

reduction, or approximately 18 burden 

hours, with an equivalent cost reduction 

of approximately $712. The 

Departments seek comment on these 

assumptions. 


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TABLE 14: Annual Burden and Costs for Withdrawals 

Estimated Estimated Burden per Total Annual Total Estimated Department Number of Number of Response Burden (Hours) Cost Respondents Responses (Hours) 

HHS 7,560 7,560 0.75 5,670 $409,676 

Labor 4,200 4,200 0.75 3,150 $227,598 

Treasury 4,200 4,200 0.75 3,150 $227,598 

OPM 840 840 0.75 630 $45,520 
Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75841 

230This is calculated as follows: 20 annual 

requests × 0.25 hours = 5 annual burden hours. 5 

annual burden hours × $39.56 hourly rate = $197.80 

total annual cost. As the Departments do not 

anticipate these proposed rules would be finalized 

and effective before July 1, 2024, the burden for 

2024 would be prorated to 50 percent, or 2.5 hours 

with an equivalent cost of $99. 

This information collection is 

approved under OMB control number 

1210–0169, and if this proposal is 

finalized, the Departments would 

rescind this information collection 

under OMB control number 1210–0169 

accordingly. The Departments seek 

comment on this proposed burden 

reduction. 

The Departments also propose to 

collect one new information collection 

element in the Federal IDR portal 

associated with the administrative fee. 

The Departments propose to require the 

initiating party to attest (for example, by 

checking a box) in the portal that no 

offer made by either party during open 

negotiation exceeded a predetermined 

threshold discussed in section II.E.3.f. of 

this preamble, to determine whether the 

parties should be charged the reduced 

administrative fee for low-dollar 

disputes. The Departments are of the 

view that checking this box would take 

a de minimis amount of time in the 

context of the total time it takes for the 

initiating party to initiate a dispute— 

2.25 hours, as discussed further in the 

PRA package for the Federal IDR 

process (OMB control number: 1210– 

0169). The Departments will add this 

information collection element to the 

information collection currently 

approved under OMB control number 

1210–0169. The Departments seek 

comment on this proposed information 

collection. 

Although the Departments would now 

be collecting the administrative fee 

directly from the disputing parties, 

rather than the certified IDR entities 

collecting the fee on the Departments’ 

behalf, generally, the information 

collected from disputing parties and 

associated with this step in the Federal 

IDR process would not change; the 

parties would be submitting this 

information to the Departments rather 

than to the certified IDR entities. 

Therefore, the Departments are of the 

view that there is no additional 

information collection burden 

associated with this proposal. The 

Departments seek comment on this 

assumption. 

8. ICRs Regarding Extension of Time 

Periods for Extenuating Circumstances 

(26 CFR 54.9816–8(g), 29 CFR 

2590.716–8(g), and 45 CFR 149.510(g)) 

The Departments anticipate that 

codifying the ability of certified IDR 

entities to submit case-by-case extension 

requests in the same manner as parties 

would slightly increase the estimated 

burden associated with collecting 

requests for extensions. In general, the 

Departments maintain the expectation 

that requests for extensions due to 

extenuating circumstances would be 

relatively limited, and do not expect 

that certified IDR entities would submit 

a high volume of requests for 

extensions, particularly since these 

proposed rules also propose to codify 

the Departments’ ability to grant caseby-case extensions of their own 

initiative without a prior request from 

certified IDR entities or parties. Based 

on internal data, the Departments 

anticipate that certified IDR entities 

would submit approximately 20 such 

requests for extensions annually. 

The Departments estimate that it 

would take an office clerk 

approximately 15 minutes (at an hourly 

rate of $39.56) on average to prepare and 

submit the Request for Extension due to 

Extenuating Circumstances form. Based 

on internal data reflecting the number of 

extension requests submitted by 

certified IDR entities, the Departments 

estimate that approximately 20 

extensions requests would be submitted 

by certified IDR entities annually. 

Accordingly, the Departments estimate 

that the burden associated with the 

submission of the extension request 

notice by certified IDR entities would 

result in a total annual burden of 5 

hours with an equivalent cost of 

approximately $197.80 230 across all 

certified IDR entities in addition to the 

existing burden estimate for extension 

requests submitted by plans, issuers, 

FEHB carriers, providers, facilities, and 

air ambulance services providers 

already approved under OMB 1210– 

0169. As the Departments and OPM 

share jurisdictions, HHS would account 

for 45 percent of the total burden, or 

approximately 2.25 burden hours, with 

an equivalent cost of approximately 

$89.01. The Departments of Labor and 

the Treasury would each account for 25 

percent of the total burden, or 

approximately 1.25 burden hours each, 

with an equivalent cost of 

approximately $49.45 each. OPM would 

account for 5 percent of the total 

burden, or approximately 0.25 burden 

hours, with an equivalent cost of 

approximately $9.89. The Departments 

seek comment on these assumptions. 


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TABLE 15: Annual Burden and Cost for Administrative Fee Collection 

Estimated Estimated Burden per Total Annual Total Estimated Department Number of Number of Response Burden Cost Respondents Responses (Hours) (Hours) 

HHS 6 6 (18) (108) ($4,272) 

Labor 3 3 (18) (54) ($2,136) 

Treasury 3 3 (18) (54) ($2,136) 

OPM 1 1 (18) (18) ($712) 
75842 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

The Departments would revise the 

information collection currently 

approved under OMB control number 

1210–0169 to account for this additional 

burden. 

9. ICRs Regarding Registration of Group 

Health Plans and Health Insurance 

Issuers (26 CFR 54.9816–9, 29 CFR 

2590.716–9, and 45 CFR 149.530) 

These proposed rules would require 

plans and issuers that are subject to the 

Federal IDR process to register and 

submit certain information to the 

Departments. 

The Departments assume that TPAs 

would register on behalf of most selfinsured plans. The Departments 

estimate that a total of 1,705 issuers and 

TPAs would incur a burden to comply 

with this provision. The Departments 

estimate that for each issuer and TPA, 

an administrative assistant would spend 

8 hours (at an hourly rate of $41.74), a 

compensation and benefits manager 

would spend 2 hours (at an hourly rate 

of $137.64), and a lawyer would spend 

2 hours (at an hourly rate of $157.48), 

to communicate with plans, gather the 

necessary information, and prepare the 

registration, resulting in a combined 

hourly rate of $77.01. The estimated 

total burden for each issuer or TPA 

would be 12 hours with an equivalent 

cost of approximately $924.16. The 

estimated total cost for initial 

registration and submission of 

information would be 20,460 hours, 

with an equivalent cost of 

approximately $1,575,693. As the 

Departments and OPM share 

jurisdictions, HHS would account for 45 

percent of the total burden, or 

approximately 9,207 burden hours, with 

an equivalent cost of approximately 

$709,062. The Departments of Labor and 

the Treasury would each account for 25 

percent of the total burden, or 

approximately 5,115 burden hours, with 

an equivalent cost of approximately 

$393,923. OPM would account for 5 

percent of the total burden, or 

approximately 1,023 burden hours, with 

an equivalent cost of approximately 

$78,785. 

The proposed regulation would also 

require that plans update the 

information associated with their 

registration no later than 30 days after 

such information changes or at least 

annually. The Departments estimate that 

for each issuer and TPA, an 

administrative assistant would spend 30 

minutes (at an hourly rate of $41.74), 

and a compensation and benefits 

manager would spend 15 minutes (at an 

hourly rate of $137.64) to update 

information in a timely way when such 

information changes, resulting in a 

combined hourly rate of $73.71. The 

estimated total burden for each issuer or 

TPA would be 0.75 hours with an 

equivalent cost of approximately $55.28. 

The Departments estimate that updating 

information in a timely way would 

incur a total cost for all issuers and 

TPAs of approximately 1,279 hours with 

an equivalent cost of approximately 

$94,252 beginning in 2025. As the 

Departments and OPM share 

jurisdictions, HHS would account for 45 

percent of the total burden, or 

approximately 575 burden hours, with 

an equivalent cost of approximately 

$42,414. The Departments of Labor and 

the Treasury would each account for 25 

percent of the total burden, or 

approximately 320 burden hours, with 

an equivalent cost of approximately 

$23,563. OPM would account for 5 

percent of the total burden, or 

approximately 64 burden hours, with an 

equivalent cost of approximately $4,713. 

BILLING CODE 6325–63–P; 4830–01–P; 4510–29–P; 

4120–01–P 


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TABLE 16: Annual Burden and Cost for Extension Requests Submitted by Certified IDR 

Entities 

Estimated Estimated Burden per Total Annual Total Estimated Department Number of Number of Response Burden (Hours) Cost Respondents Responses (Hours) 

HHS 9 9 0.25 2.25 $89 

Labor 5 5 0.25 1.25 $49 

Treasury 5 5 0.25 1.25 $49 

OPM 1 1 0.25 0.25 $10 

TABLE 17: One-Time Burden and Cost for Plans and Issuers for Initial Registration and 

Submission of Certain Information to the Departments 

Estimated Estimated Burden per Total Annual Total Estimated Year Department Number of Number of Response Burden Cost Respondents Responses (Hours) (Hours) 

HHS 767 767 12 9,207 $709,062 

Labor 426 426 12 5,115 $393,923 2023 

Treasury 426 426 12 5,115 $393,923 

OPM 85 85 12 1,023 $78,785 
Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75843 

231OMB Control Number: 0938–1401 (CMS– 

10780, Requirements Related to Surprise Billing: 

Qualifying Payment Amount, Notice and Consent, Disclosure on Patient Protections Against Balance 

Billing, and State Law Opt-in). 

The Departments would revise the 

information collection currently 

approved under OMB control number 

1210–0169 to account for this new 

burden.231 The Departments seek 

comment on these burden estimates. 

The information collections are 

summarized as follows: 


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TABLE 18: Annual Burden and Cost for Plans and Issuers to Register and Submit 

Certain Information to the Departments 

Estimated Estimated Burden per Total Annual Total Estimated Department Number of Number of Response Burden Cost Respondents Responses (Hours) (Hours) 

HHS 767 767 0.75 575 $42,414 

DOL 426 426 0.75 320 $23,563 

Treasury 426 426 0.75 320 $23,563 

OPM 85 85 0.75 64 $4,713 
75844 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 


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TABLE 19: Annual Recordkeeping and Reporting Requirements 

Regulation 0MB Respondents Responses Burden Total Hourly Total Labor 

Section Control per Annual Labor Cost Cost of 

Number Response Burden of Reporting 

(hours) (hours) Reportin11: 

45 CFR 1210- HHS: HHS: HHS: HHS: HHS: HHS: 

149.510(b)( 0169 472,500 472,500 0.75 378,000 $104.95 $39,671, I 00 

I) Labor: Labor: Labor: Labor: Labor: Labor: 

262,500 262,500 0.75 210,000 $104.95 $22,039,500 

Treasury: Treasury: Treasu,y: Treasu,y: Treasury: Treasury: 

262,500 262,500 0.75 210,000 $104.95 $22,039,500 

Ol'M- Ol'M: Ol'M- Ol'Af: Ol'M- Ol'M: 

52 500 52,500 0.75 42,000 $104.95 $4 407 900 

45 CFR 1210- HHS: HHS: HHS: HHS: HHS: HHS: 

149.510(b)( 0169 378,000 378,000 0.75 283,500 $104.95 $29,753,325 

2) Labor: Labor: Labor: Labor: Labor: Labor: 

210,000 210,000 0.75 157,500 $104.95 $16,529,625 

Treasury: Treaswy: Treasury: Treaswy: Treasury: Treasury: 

210,000 210,000 0.75 157,500 $104.95 $16,529,625 

OPM: OPM: OPM: OPM: OPM: OPM: 

42,000 42,000 0.75 31,500 $104.95 $3,305,925 

HHS: 44,370 HHS: HHS: HHS: HHS: HHS: 

45 CFR 1210- Labor: 44,370 0.53 29,295 $39.56 $1,158,910 

149.5 l0(c)( 0169 24,650 Labor: Labor: Labor: Labor: Labor: 

1) Treasury: 24,650 0.53 16,275 $39.56 $643,839 

24,650 Treasury: Treasury: Treasury: Treasury: Treasury: 

OPM: 4,930 24,650 0.53 16,275 $39.56 $643,839 

OPM: OPM: OPM: 3,255 OPM: OPM: 

4,930 0.53 $39.56 $128,767 

HHS: 7,560 HHS: 7,560 HHS: HHS: 5,670 HHS: HHS: $409,676 

45 CFR 1210- Labor: 4,200 Labor: 0.75 Labor: $72.25 Labor: 

149.5 I0(c)( 0169 Treasury: 4,200 Labor: 3,150 Labor: $227,598 

3) 4,200 Treasury: 0.75 Treasury: $72.25 Treasury: 

OPM- 840 4,200 Treasury: 3,150 Treasury: $227,598 

OPM: 840 0.75 OPM: 630 $72.25 OPM: $45,520 

OPM: OPM: 

0.75 $72.25 

45 CFR 1210- HHS:6 HHS:6 HHS: (18) HHS: (108) HHS: HHS: ($4,272) 

149.5 lO(d) 0169 Labor: 3 Labor: 3 Labor: Labor: (54) $39.56 Labor: ($2,136) 

Treasury: 3 Treasury: 3 (18) Treasury: Labor: Treasury: 

OPM: 1 OPM: 1 Treasury: (54) $39.56 ($2,136) 

(18) OPM: (18) Treasury: OPM: ($712) 

OPM- $39.56 

(18) OPM-

$39.56 

HHS:9 HHS:9 HHS: HHS: 2.25 HHS: HHS: $89 

45CFR 1210- Labor: 5 Labor: 5 0.25 Labor: 1.25 $39.56 Labor: $49 

149.5 I0(g) 0169 Tremury: 5 Treasury: 5 Labor: Treasury: Labor: Treasury: $49 

OPM.1 OPM: 1 0.25 1.25 $39.56 OPM: $10 

Treasury: OPM: 0.25 Treasury: 

0.25 $39.56 

OPM- OPM0.25 $39.56 

HHS: 767 HHS: 767 HHS: HHS: 575 HHS: HHS: $42,414 

45CFR 1210- Labor: 426 Labor: 426 0.75 Labor: 320 $73.71 Labor: $23,563 

149.530 0169 Treaswy: Treasury: Labor: Treasury: Labor: Treasury: 

426 426 0.75 320 $73.71 $23,563 

OPM: 85 OPM: 85 OPM: 64 OPM: $4,713 
Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75845 

232 840,000 respondents are duplicated between 

the open negotiation and Federal IDR proess 

initiation information collections becuase these 

respondents must complete open negotiations to be 

a party to an initiated dispute; therefore, the total 

number of respondents has been reduced to reflect 

an accurate total of respondents. 

BILLING CODE 6325–63–C; 4510–01–C; 4120–01–C 

10. Submission of PRA-Related 

Comments232

The Departments have submitted a 

copy of these proposed rules to OMB for 

its review of the rule’s information 

collection and recordkeeping 

requirements. These requirements are 

not effective until they have been 

approved by the OMB. 

To obtain copies of the supporting 

statement and any related forms for the 

proposed collections for control number 

0938–1401, please visit CMS’s website 

at https://www.cms.gov/Regulationsand-Guidance/Legislation/ 

PaperworkReductionActof1995/PRAListing. To obtain copies of the 

supporting statement for control number 

1210–0169, please go to https:// 

www.RegInfo.gov or email the request to 

ebsa.opr@dol.gov and reference control 

number 1210–0169. The Departments 

invite public comment on these 

potential information collection 

requirements. Commenters may send 

their views on the Departments’ PRA 

analysis in the same way they send 

comments in response to these proposed 

rules as a whole (for example, through 

the https://www.regulations.gov 

website), including as part of a comment 

responding to the broader proposed 

rules. 

If you wish to comment, please 

submit your comments electronically as 

specified in the ADDRESSES section of 

these proposed rules and identify the 

rule (CMS–9897–P), the ICR’s CFR 

citation, CMS ID number, and OMB 

control number. 

ICR-related comments are due January 

2, 2024. 

G. Regulatory Flexibility Act 

The Regulatory Flexibility Act (RFA) 

(5 U.S.C. 601, et seq.) requires agencies 

to analyze options for regulatory relief 

of small entities to prepare an initial 

regulatory flexibility analysis to 

describe the impact of these proposed 

rules on small entities, unless the head 

of the agency can certify that the rule 

will not have a significant economic 

impact on a substantial number of small 

entities. The RFA generally defines a 

‘‘small entity’’ as (1) a proprietary firm 

meeting the size standards of the Small 

Business Administration (SBA), (2) a 

not-for-profit organization that is not 

dominant in its field, or (3) a small 

government jurisdiction with a 

population of less than 50,000. States 

and individuals are not included in the 

definition of ‘‘small entity.’’ The 

Departments use a change in revenues 

of more than 3 to 5 percent as its 

measure of significant economic impact 

on a substantial number of small 

entities. For purposes of the RFA, small 

entities include small businesses, 

nonprofit organizations, and small 

governmental jurisdiction. 

1. Need for Regulatory Action, 

Objectives, and Legal Basis 

This proposed rulemaking authorized 

by the No Surprises Act is intended to 

address specific issues that are critical 

to ensuring the timely rendering of 

payment determinations and to address 

feedback from interested parties and 

certified IDR entities to improve the 

functioning of the Federal IDR process. 

These proposed rules are intended to 

address some of the common 

communication issues between 

disputing parties stemming from a lack 

of clarity as to whether items and 

services are qualified IDR items and 

services covered by the No Surprises 

Act. These proposed rules would 

impose requirements and create 

incentives for parties to engage with one 

another during the open negotiation 

period, which would help reduce the 

volume of ineligible disputes being 

submitted. Specifically, these proposed 

rules would make changes to the 

information that plans, issuers, 

providers, facilities, and providers of air 

ambulance services must share before 

initiating the Federal IDR process by 

including proposals at 26 CFR 54.9816– 

6A, 29 CFR 2590.716–6A, and 45 CFR 

149.100 to require plans and issuers to 

provide CARCs and RARCs when 

providing any paper or electronic 

remittance in response to a claim for 

payment for health care items or 

services furnished by an entity with 

which it does not have a direct or 

indirect contractual relationship. 

Additionally, the Departments propose 

amendments at 26 CFR 54.9816–6, 29 

CFR 2590.716–6, and 45 CFR 149.140 to 

the information that must be disclosed 

about the QPA. These proposed rules 

would also establish new requirements 

at 26 CFR 54.9816–9, 29 CFR 2590.716– 

9, and 45 CFR 149.530, which would 

require plans and issuers to register 

with the Federal IDR portal to better 

enable a provider, facility, or provider of 

air ambulance services to identify the 

appropriate plan or issuer with which it 

has a dispute and determine whether its 

coverage of an item or service is subject 

to a specified State law, an All-Payer 


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Regulation 0MB Respondents Responses Burden Total Hourly Total Labor 

Section Control per Annual Labor Cost Cost of 

Number Response Burden of Reporting 

(hours) (hours) Reportin2 

Treasury: Treasury: 

0.75 $73.71 

OPM: OPM: 

0.75 $73.71 

Total HHS: HHS: HHS: HHS: 

525,212 903,212 673,310 $68,551,798 

labor: labor: labor: labor: 

291,784 501,784 374,067 $38,084,569 

Treasury: Treasury: Treasury: Treasury: 

291,784 501,784 374,067 $38,084,569 

OPM- OPM· OPM- OPM· 

58,357 100,357 74,086 $7,616,630 

Overall: Overall: Overall: Overall: 

1,167,137232 2,007,137 1496 249 $152,337 567 
75846 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

233Section 9816(c)(4)(F) of the Code, section 

716(c)(4)(F) of ERISA, and section 2799A–1(c)(4)(F) 

of the PHS Act. 

234The Department of Labor consulted with the 

Small Business Administration Office of Advocacy 

in making this determination, as required by 5 

U.S.C. 603(c) and 13 CFR 121.903(c) in a memo 

dated June 4, 2020. 

235See 29 CFR 2520.104–20, 2520.104–21, 

2520.104–41, 2520.104–46, and 2520.104b-10. 

Model Agreement, or the Federal IDR 

process for determining the out-ofnetwork rate. 

To further facilitate communication 

and improve open negotiations, these 

proposed rules would amend the open 

negotiation process that precedes the 

Federal IDR process. Specifically, at 26 

CFR 54.9816–8(b)(1), 29 CFR 2590.716– 

8(b)(1), and 45 CFR 149.510(b)(1), these 

proposed rules would amend the 

content requirements of the standard 

open negotiation notice, would establish 

requirements related to an open 

negotiation response notice, and would 

clarify the timing for when the open 

negotiation period begins. These 

proposed rules would also amend the 

process for initiating the Federal IDR 

process. Specifically, at 26 CFR 

54.9816–8(b)(2), 29 CFR 2590.716– 

8(b)(2), and 45 CFR 149.510(b)(2), these 

proposed rules would amend the 

content of the notice of IDR initiation 

and establish new requirements for a 

notice of IDR initiation response from 

the non-initiating party. At 26 CFR 

54.9816–8T(b)(3), 29 CFR 2590.716– 

8(b)(3), and 45 CFR 149.510(b)(3), these 

proposed rules would also establish a 

new manner for providing notices to the 

other party and the Departments. 

These proposed rules would also 

provide additional clarity regarding 

timeframes within the Federal IDR 

process. The No Surprises Act includes 

certain timeframes by which certain 

steps of the Federal IDR process must be 

conducted. For example, disputing 

parties must jointly select a certified 

IDR entity not later than the last day of 

the 3-business-day period following the 

date of the initiation of the Federal IDR 

process, and if the parties fail to jointly 

select a certified IDR entity, the 

Departments must select a certified IDR 

entity not later than 6 business days 

after the date of IDR initiation.233 While 

the No Surprises Act also provides 

detailed timeframes for certain other 

steps in the process, the steps that must 

be conducted before a payment 

determination can be issued are not as 

clearly defined, such as when a certified 

IDR entity must conduct a conflict-ofinterest review and must determine 

whether an item or service is a qualified 

IDR item or service, as defined in 26 

CFR 54.9816–8T(a)(2)(xi), 29 CFR 

2590.716–8(a)(2)(xi), and 45 CFR 

149.510(a)(2)(xi), and eligible for the 

Federal IDR process. Therefore, the 

provisions in these proposed rules 

would adjust certain steps and establish 

associated timeframes (see Table 1). 

These include provisions related to 

establishing a process for preliminary 

selection of the certified IDR entity and 

final selection of the certified IDR entity 

as set out in 26 CFR 54.9816–8(c)(1), 29 

CFR 2590.716–8(c)(1), and 45 CFR 

149.510(c)(1), in order to account for the 

time it takes certified IDR entities to 

confirm that they do not have a conflict 

of interest with either party. To allow 

more time for certified IDR entities to 

conduct eligibility reviews, these 

proposed rules would include proposed 

amendments to the Federal IDR process 

eligibility review proposed in 26 CFR 

54.9816–8T(c)(2), 29 CFR 2590.716– 

8(c)(2), and 45 CFR 149.510 (c)(2). As 

discussed in section I.H. of this 

preamble, eligibility reviews have 

proven to be complex and time 

consuming. In extenuating 

circumstances, such as when dispute 

volume is high, it may be more 

appropriate for the Departments, rather 

than certified IDR entities, to conduct 

eligibility reviews to facilitate quicker 

dispute processing. Therefore, these 

proposed rules would establish a 

Departmental eligibility review process 

in proposed paragraph 26 CFR 54.9816– 

8(c)(2)(ii), 29 CFR 2590.716–8(c)(2)(ii), 

and 45 CFR 149.510 (c)(2)(ii). Further, to 

support eligibility determinations, 

conflict-of-interest reviews, and 

payment determinations, the 

Departments propose requirements for 

the submission of additional 

information from the disputing parties 

at 26 CFR 54.9816–8(c)(2)(iii), 29 CFR 

2590.716–8(c)(2)(iii), and 45 CFR 

149.510(c)(2)(iii). To clarify and 

establish a standard process for disputes 

to be withdrawn from the Federal IDR 

process, the Departments propose four 

conditions in which a dispute may be 

withdrawn at 26 CFR 54.9816–8(c)(3)(i), 

29 CFR 2590.716–8(c)(3)(i), and 45 CFR 

149.510(c)(3)(ii). To further adjust 

timeframes and processes associated 

with the Federal IDR process, these 

proposed rules would include proposed 

amendments related to submission of 

offers and payment determination and 

notification at 26 CFR 54.9816–8(c)(5), 

29 CFR 2590.716–8(c)(5), and 45 CFR 

149.510(c)(5); the collection of the 

certified IDR entity fee at 26 CFR 

54.9816–8(d)(1), 29 CFR 2590.716– 

8(d)(1), and 45 CFR 149.510(d)(1); and 

the collection of the administrative fee, 

including a process for setting a reduced 

administrative fee for low-dollar amount 

disputes and for non-initiating parties in 

cases of ineligible disputes, at 26 CFR 

54.9816–8(d)(2), 29 CFR 2590.716– 

8(d)(2), and 45 CFR 149.510(d)(2). These 

proposed rules also include provisions 

to expand upon situations in which 

Federal IDR process timeframes may be 

waived due to extenuating 

circumstances at 26 CFR 54.9816–8T(g), 

29 CFR 2590.716–8(g), and 45 CFR 

149.510(g). 

Lastly, to address concerns regarding 

the vacated batching provision at 26 

CFR 54.9816–8(c)(3)(i)(C), 29 CFR 

2590.716–8(c)(3)(i)(C), and 45 CFR 

149.510(c)(3(i)(C) and to create more 

efficiencies in the process, these 

proposed rules at 26 CFR 54.9816– 

8(c)(4), 29 CFR 2590.716–8(c)(4), and 45 

CFR 149.510(c)(4) include provisions 

that would allow for more flexibility in 

batching multiple items or services in a 

single dispute. 

It is the Departments’ intention that 

the implementation of the proposed 

provisions in these proposed rules, if 

finalized, would lead to a more efficient 

Federal IDR process and more timely 

payment determinations. 

2. Small Entities Regulated 

The provisions in these proposed 

rules would affect plans (or their TPAs), 

health insurance issuers offering group 

or individual health insurance coverage, 

certified IDR entities, and providers, 

facilities, and providers of air 

ambulance services. 

For purposes of analysis under the 

RFA, the Departments consider an 

employee benefit plan with fewer than 

100 participants to be a small entity.234

The basis of this definition is found in 

section 104(a)(2), which permits the 

Secretary of Labor to prescribe 

simplified annual reports for plans that 

cover fewer than 100 participants. 

Under section 104(a)(3), the Secretary 

may also provide for exemptions or 

simplified annual reporting and 

disclosure for welfare benefit plans. 

Under the authority of section 104(a)(3), 

DOL has previously issued simplified 

reporting provisions and limited 

exemptions from reporting and 

disclosure requirements for small plans, 

including unfunded or insured welfare 

plans, which cover fewer than 100 

participants and satisfy certain 

requirements.235 While some large 

employers have small plans, small plans 

are generally maintained by small 

employers. Thus, the Departments are of 

the view that assessing the impact of 

these proposed rules on small plans is 

an appropriate substitute for evaluating 

the effect on small entities. The 

definition of a small entity considered 


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236 13 CFR 121.201 (2011). 237 15 U.S.C. 631 et seq. (2011). 238Centers for Medicare and Medicaid Services. 

(2022). Medical Loss Ratio Data and System 

Resources. https://www.cms.gov/CCIIO/Resources/ 

Data-Resources/mlr. There are 483 issuers of health 

insurance coverage nationwide and 1,500 issuerState combinations. 239Non-issuer TPAs based on data derived from 

the 2016 benefit year reinsurance program 

contributions. 240United States Small Business Administration. 

(March 17, 2023). Table of Size Standards. https:// 

www.sba.gov/document/support--table-sizestandards. 241Centers for Medicare and Medicaid Services. 

(2022). Medical Loss Ratio Data and System 

Resources. https://www.cms.gov/CCIIO/Resources/ 

Data-Resources/mlr. 242The Departments are of the view that most 

TPAs are also issuers. 243These numbers are calculated as follows: 77 

percent of small companies belong to larger holding 

groups, so 23 percent do not and would be small 

entities. 87 issuers × 0.23 = 20. 20/483 = 4.1 

percent. Applying the 4.1 percent to 1,500 issuers 

and 205 TPAs total = 62 small issuers and 8 small 

TPAs. 

244Historically, less than 1 percent of disputes for 

emergency and non-emergency services have been 

submitted by group health plans, health insurance 

issuers, or FEHB carriers. See U.S. Department of 

Labor, U.S. Department of the Treasury, and U.S. 

Department of Health and Human Services. 

(December 15, 2022) Initial Report on the Federal 

Independent Dispute Resolution (IDR) Process, 

April 15—September 30, 2022. https:// 

www.cms.gov/files/document/initial-report-idrapril-15-september-30-2022.pdf. 

245Based on data from the NAICS Association for 

NAICS code 62111, the Departments estimate the 

percent of businesses within the industry of Offices 

of Physicians with less than $16 million in annual 

sales. See https://www.census.gov/data/tables/ 

2017/econ/susb/2017-susb-annual.html. 

246ASPE Office of Health Policy. (September 10, 

2021). Air Ambulance Use and Surprise Billing. 

https://aspe.hhs.gov/sites/default/files/2021-09/ 

aspe-air-ambulance-ib-09-10-2021.pdf. 

247Adler, L., Hannick, K., and Lee, S. High Air 

Ambulance Charges Concentrated in Private EquityOwned Carriers. U.S.C.-Brookings Schaffer 

Initiative for Health Policy. October 13, 2020. 

248See U.S. Department of Health and Human 

Services, U.S. Department of Labor, and U.S. 

Department of the Treasury, Partial Report on the 

Federal Independent Dispute Resolution (IDR) 

Process, October 1—December 31, 2022. (n.d.). 

https://www.cms.gov/files/document/partial-reportidr-process-octoberdecember-2022.pdf. 

249See Chart for Determining the Applicability for 

the Federal Independent Dispute Resolution (IDR) 

Process (n.d.). https://www.cms.gov/files/ 

document/caa-federal-idr-applicability-chart.pdf. 

250 Id. 

appropriate for this purpose differs, 

however, from a definition of a small 

business based on size standards issued 

by the SBA 236 in accordance with the 

Small Business Act.237

In 2021, there were 1,500 issuers in 

the U.S. health insurance market 238 and 

205 TPAs.239 Health insurance issuers 

are generally classified under the North 

American Industry Classification 

System (NAICS) code 524114 (Direct 

Health and Medical Insurance Carriers). 

According to SBA size standards,240

entities with average annual receipts of 

$47 million or less are considered small 

entities for this NAICS code. The 

Departments expect that few, if any, 

insurance companies underwriting 

health insurance policies fall below 

these size thresholds. Based on data 

from MLR annual report submissions for 

the 2021 MLR reporting year, 

approximately 87 out of 483 issuers of 

health insurance coverage nationwide 

had total premium revenue of $47 

million or less.241 However, it should be 

noted that also based on MLR data, over 

77 percent of these small companies 

belong to larger holding groups, and 

many, if not all, of these small 

companies, are likely to have non-health 

lines of business that would result in 

their revenues exceeding $47 million. 

The Departments are of the view that 

the same assumptions also apply to 

TPAs that would be affected by these 

proposed rules.242 To produce a 

conservative estimate, for the purposes 

of this analysis, the Departments assume 

4.1 percent, or 62 health insurance 

issuers and 8 TPAs, of the total of 1,500 

health insurance issuers and 205 TPAs 

across the country, are considered small 

entities.243 The Departments seek 

comment on this assumption. 

These proposed rules would also 

affect health care providers due to the 

proposed requirements for the initiating 

party to submit the open negotiation 

notice to the non-initiating party and 

the Departments, among other 

proposals.244 The Departments estimate 

that 140,270 physicians, on average, bill 

on an out-of-network basis. The number 

of small physicians is estimated based 

on the SBA’s size standards. The size 

standard applied for providers is NAICS 

62111 (Offices of Physicians), for which 

a business with less than $16 million in 

receipts is considered to be small. By 

this standard, the Departments estimate 

that 47.2 percent or 66,207 physicians 

are considered small under the SBA’s 

size standards.245 These proposed rules 

are also expected to affect nonphysician providers who bill on an outof-network basis. The Departments lack 

data on the number of non-physician 

providers who would be impacted. 

The Departments do not have the 

same level of data for the air ambulance 

sub-sector. In 2020, the total revenue of 

providers of air ambulance services was 

estimated to be $4.2 billion, with 1,114 

air ambulance bases.246 This results in 

an industry average of $3.8 million per 

air ambulance base. Based on a 2020 

U.S.C.-Brookings Schaeffer report on air 

ambulance services,247 by 2017, large 

private equity firms controlled roughly 

two-thirds of the air ambulance market. 

The Departments seek comment on the 

number of small entities in the air 

ambulance market. 

Although based on the Departments’ 

experience operating the Federal IDR 

process, significantly fewer than 66,207 

small providers have accessed the 

process to date, and the vast majority of 

disputes are initiated by 10 large 

revenue cycle management companies 

or provider groups,248 the Departments 

lack adequate data to better inform the 

number of small providers impacted by 

these proposed rules. The Departments 

are also aware that many providers are 

subject to a specified State law or AllPayer Model Agreement, rather than the 

Federal IDR process, and therefore 

would not have reason to access the 

Federal IDR process or need to review 

these proposed rules.249 Therefore, 

although the Departments acknowledge 

that 66,207 small providers is likely a 

significant overestimate of the number 

of small providers impacted by these 

proposed rules, the Departments use 

this number of small providers in this 

analysis to be conservative. The 

Departments seek comment on this 

assumption. 

Additionally, as discussed in the 

Partial Report on the Federal 

Independent Dispute Resolution (IDR) 

Process, October 1—December 31, 2022, 

the top 10 initiating parties initiate 

approximately 85 percent of disputes, 

and the top 10 non-initiating parties are 

initiated against in approximately 95 

percent of disputes.250 These top 10 

parties are large provider groups or 

revenue cycle management groups and 

large insurance companies or their 

representatives. Therefore, for purposes 

of this analysis, the Departments assume 

that only 15 percent of all disputes 

involve small providers. The 5 percent 

of all disputes that do not involve the 

top 10 non-initiating parties could 

involve any of the 1,695 issuers and 

TPAs that are not the top 10 noninitiating parties (1,500 issuers and 205 

TPAs total ¥ 10 top non-initiating 

parties = 1,695 remaining issuers and 

TPAs). The Departments assume that 

the same proportion of small issuers and 

TPAs to all issuers and TPAs also 

applies to the number of disputes each 

issuer or TPA is involved in, as small 

issuers and TPAs cover fewer enrollees 

than large issuers and TPAs. The 

Departments seek comment on this 

assumption. 

3. Compliance Requirements 

The proposed policies that would 

result in an increased burden to small 

entities are described below. 


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251 560,000 disputes in open negotiations—85 

percent (476,000) disputes entered into open 

negotiations by the top 10 initiating parties = 84,000 

disputes entered into open negotiations by other 

initiating parties. 84,000 disputes/66,207 small 

providers = approximately 1 dispute initiated per 

small provider annually. 1 dispute × $78.71 per 

dispute = $79 per small provider. 

252 560,000 disputes in open negotiations—95 

percent (532,000) disputes entered into open 

negotiations against the top 10 non-initiating parties 

= 28,000 disputes entered into open negotiations 

against other non-initiating parties. 28,000 

disputes/1,695 issuers/TPAs = 17 disputes per 

issuer/TPA. 17 disputes × $78.71 per dispute = 

$1,338 per small issuer/TPA. 

253 420,000 disputes initiated—85 percent 

(357,000) disputes initiated by the top 10 initiating 

parties = 63,000 disputes initiated by other 

initiating parties. 63,000 disputes/66,207 small 

providers = approximately 1 dispute initiated per 

small provider annually. 1 dispute × $78.71 per 

dispute = $79 per small provider. 

254 420,000 disputes initiated—95 percent 

(399,000) disputes initiated against the top 10 noninitiating parties = 21,000 disputes initiated against 

other non-initiating parties. 21,000 disputes/1,695 

issuers/TPAs = 12 disputes per issuer/TPA 

annually. 12 disputes × $78.71 per dispute = $945 

per small issuer/TPA. 

255 120,200 disputes for which a notice of 

certified IDR entity selection is required—85 

percent (102,170) disputes initiated by the top 10 

initiating parties = 18,030 disputes for other 

initiating parties. 18,030 disputes/66,207 small 

providers = less than 1 dispute per small provider 

annually. 1 dispute × $21.14 = $21 per small 

provider. 

256 120,200 disputes for which a notice of 

certified IDR entity selection is required—95 

percent (114,190) disputes initiated against the top 

10 non-initiating parties = 6,010 disputes for other 

non-initiating parties. 6,010 disputes/1,695 issuers/ 

TPAs = 4 disputes per issuer/TPA annually. 4 

disputes × $21.14 = $85 per small issuer/TPA. 

257 16,800 disputes withdrawn—85 percent 

(14,280) disputes withdrawn by the top 10 initiating 

parties = 2,520 disputes withdrawn by other 

initiating parties. 2,520 disputes/66,207 small 

providers = less than 1 dispute withdrawn per 

small provider annually. 1 dispute × $44.30 per 

dispute = $44 per small provider. 

258 16,800 disputes withdrawn—95 percent 

(15,960) disputes withdrawn against the top 10 noninitiating parties = 840 disputes withdrawn against 

other non-initiating parties. 840 disputes/1,695 

issuers/TPAs = less than 1 dispute withdrawn per 

issuer/TPA annually. 1 dispute × $9.89 per dispute 

= $10 per small issuer/TPA. 

259 420,000 disputes initiated—85 percent 

(357,000) disputes initiated by the top 10 initiating 

parties = 63,000 disputes initiated by other 

initiating parties. 63,000 disputes/66,207 small 

providers = approximately 1 dispute initiated per 

small provider annually. 1 dispute × $150 per 

dispute = $150 per small provider. 

260 420,000 disputes initiated—95 percent 

(399,000) disputes initiated against the top 10 noninitiating parties = 21,000 disputes initiated against 

other non-initiating parties. 21,000 disputes/1,695 

issuers/TPAs = 12 disputes per small issuer/TPA 

annually. Of those 12 disputes, issuers/TPAs would 

pay a $75 administrative fee for 16 percent (or 2 

disputes), a $30 administrative fee for 22 percent (or 

3 disputes), and a $150 administrative fee for 62 

percent (or 7 disputes). (2 disputes × $75 per 

dispute) + (3 disputes × $30 per dispute) + (7 

disputes × $150 per dispute) = $1,290. 

The Departments propose to require 

that plans and issuers use CARCs and 

RARCs to convey information related to 

the No Surprises Act, on electronic and 

paper remittance advice. The annual 

burden per issuer/TPA associated with 

this proposal is $909. For more details, 

please refer to section V.D.2.a. of this 

preamble. 

The Departments also propose to 

amend the information plans and 

issuers must provide related to the QPA 

with an initial payment or notice of 

denial of payment. The one-time burden 

per issuer/TPA associated with this 

proposal is $297. For more details, 

please refer to V.F.2 of this preamble. 

Additionally, the Departments 

propose to require the party to provide 

an open negotiation notice and 

supporting documentation to the other 

party and the Departments to initiate the 

open negotiation period. Furthermore, 

the party in receipt of the open 

negotiation notice would be required to 

provide a response to the open 

negotiation notice that is provided to 

the other party and the Departments 

within the first 15 business days of the 

30-business-day open negotiation 

period. The annual burden per small 

provider associated with this proposal is 

$79,251 and the annual burden per small 

issuer/TPA associated with this 

proposal is $1,338.252 For more details, 

please refer to section V.F.3. of this 

preamble. 

Furthermore, the Departments 

propose to continue requiring the 

initiating party to submit a written 

notice of IDR initiation to the noninitiating party and to the Departments. 

The Departments also propose that the 

non-initiating party must submit a 

written response to the notice of IDR 

initiation to the initiating party and to 

the Departments. The annual burden per 

small provider associated with this 

proposal is $79,253 and the annual 

burden per small issuer/TPA associated 

with this proposal is $945.254 For more 

details, please refer to section V.F.4.a. of 

this preamble. 

Additionally, the Departments 

propose to revise the content in the 

notice of certified IDR entity selection 

form to reflect that this notice would 

only be used in situations in which the 

non-initiating party disagrees with the 

initiating party’s preferred certified IDR 

entity identified in the notice of IDR 

initiation form. The annual burden per 

small provider associated with this 

proposal is $21,255 and the annual 

burden per small issuer/TPA associated 

with this proposal is $85.256 For more 

details, please refer to section V.F.4.b. of 

this preamble. 

Moreover, the Departments propose to 

establish a process for disputes to be 

withdrawn from the Federal IDR 

process, including the creation of new 

notice of withdrawal and notice of 

withdrawal response forms. The annual 

burden per small provider associated 

with this proposal is $44,257 and the 

annual burden per small issuer/TPA 

associated with this proposal is $10.258

For more details, please refer to section 

V.F.6. of this preamble. 

Additionally, for disputes initiated on 

or after January 1, 2025, the 

Departments propose to establish the 

administrative fee amount at $150 per 

party per dispute, a reduced 

administrative fee amount for both 

parties in low-dollar disputes of $75 per 

party per dispute, and a reduced 

administrative fee for non-initiating 

parties in ineligible disputes of $30 per 

party per dispute. The annual burden 

per small provider associated with this 

proposal is $150,259 and the annual 

burden per small issuer/TPA is 

$1,290.260 For more details, please refer 

to section V.D.2.i.i. of this preamble. 

Finally, the Departments propose to 

require plans and issuers to submit 

information to the Departments to 

receive a registration number. The 

initial (one-time) burden per issuer/TPA 

associated with this proposal is $924, 

and the annual burden per issuer/TPA 

associated with this proposal is $55. For 

more details, please refer to section 

V.F.9. of this preamble. 

The Departments estimate the onetime cost to review the rule would be 

$1,575 per entity. For more details, 

please refer to section V.D.4. of this 

preamble. 

Thus, the per-entity estimated annual 

cost for each small issuer/TPA is $4,632, 

and the per-entity estimated annual cost 

for each small provider is $373. The 

total annual cost for small issuers and 

TPAs is $324,240, and the total annual 

cost for small providers is $24,695,211. 

The per-entity estimated one-time cost 

for each small issuer/TPAs is $2,796, 

and the per-entity estimated one-time 

cost for each small provider is $1,575. 

The total one-time cost for small issuers 

and TPAs is $195,720, and the total onetime cost for small providers is 

$622,125. See Tables 20, 21, 22, and 23. 

BILLING CODE 6325–63–P; 4830–01–P; 4510–29–P; 

4120–01–P 


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261Fielder, M., Adler, L., Ippolito, B. (March 16, 

2021). Recommendations for Implementing the No 

Surprises Act. U.S.C.-Brookings Schaeffer on Health 

Policy. https://www.brookings.edu/blog/uscbrookings-schaeffer-on-health-policy/2021/03/16/ 

recommendations-for-implementing-the-nosurprises-act/. 

BILLING CODE 6325–63–C; 4830–01–C; 4510–29–C; 

4120–01–C 

The annual cost per small provider of 

$373 is approximately 0.03 percent of 

the average annual receipts per small 

provider. The Departments anticipate 

that small providers would be unlikely 

to initiate disputes and thereby incur 

these costs unless they anticipate 

prevailing in the dispute and receiving 

payment from issuers or TPAs that 

exceed the costs incurred to initiate the 

dispute. The Departments therefore are 

of the view that small providers could 

experience an increase in receipts 

commensurate or larger than the 

increase in costs. The annual cost per 

small issuer/TPA of $4,632 is 

approximately 0.25 percent of the 

average annual receipts per small 

issuer/TPA. The Departments anticipate 

that small issuers/TPAs could pass on 

these increased costs to consumers in 

the form of higher premiums (or for 

TPAs, higher administration fees), 

resulting in an increase in receipts 

commensurate with the increase in 

costs. However, the Departments are of 

the view that the actual increase in costs 

and subsequent impact on revenue is de 

minimis and likely to decrease due to 

the proposals in these rules, as many 

proposals are anticipated to result in 

increased efficiency and fewer dispute 

initiations, as discussed further in 

section V.D.1.l. of this preamble. 

Additionally, the Departments 

anticipate that by batching qualified IDR 

items and services, there may be a 

reduction in the per-service cost of the 

Federal IDR process, and potentially the 

aggregate administrative costs, because 

the Federal IDR process is likely to 

exhibit at least some economies of 

scale.261 The Departments seek 

comment on these assumptions. 

Thus, the Departments do not 

anticipate that these proposed rules 

would have a significant impact on a 

substantial number of small entities, 

based on the HHS threshold of 3 to 5 

percent change in revenue. The 

Departments seek comment on this 

analysis and seek information on the 


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TABLE 20: Detailed Annual Costs for Small Entities 

Description of Cost Annual Cost per Small Annual Cost per Small Provider 

IssuerlTPA 

CARCs and RARCs $909 NIA 

Open Negotiation $1,338 $79 

Initiation $945 $79 

Certified IDR Entity Selection $85 $21 

Withdrawal $10 $44 

Administrative Fees $1,290 $150 

Registration $55 NIA 

Total $4,632 $373 

TABLE 21: Aggregate Annual Costs for Small Entities 

Affected Entity Affected Small Entities Annual Cost per Entity Aggregate Annual Cost for 

Small Entities 

IssuerlTPA 70 $4,632 $324,240 

Provider 66,207 $373 $24,695,211 

TABLE 22: One-Time Costs for Small Entities 

Description of Cost One-Time Cost per Small One-Time Cost per Small 

IssuerlTPA Provider 

QPA Disclosures $297 NIA 

Registration $924 NIA 

Regulatory Review $1,575 $1,575 

Total $2,796 $1,575 

TABLE 23: Aggregate One-Time Costs for Small Entities 

Affected Entity Affected Small Entities One-Time Cost per Entity Aggregate One-Time Cost 

for Small Entities 

lssuerlTPA 70 $2,796 $195,720 

Provider 395 $1,575 $622,125 
75850 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

262See Federal Independent Dispute Resolution 

(IDR) Process Administrative Fee and Certified IDR 

Entity Fee Ranges proposed rules. 88 FR 65888 

(September 26, 2023). 

number of small issuers, TPAs, or 

providers that may be affected by the 

provisions in these proposed rules, as 

well as any additional costs associated 

with these proposed rules that could 

have a significant economic impact on 

a substantial number of small entities. 

4. Duplication, Overlap, and Conflict 

With Other Rules and Regulations 

The Departments do not anticipate 

any duplication, overlap, or conflict 

with other rules and regulations 

associated with these proposed rules. 

These proposed rules revise current 

regulations and add new regulations to 

continue to implement the No Surprises 

Act and improve the Federal IDR 

process. The Departments seek 

comment on any duplication, overlap, 

or conflict with other rules and 

regulations identified by interested 

parties. 

5. Significant Alternatives 

The regulatory alternatives considered 

in developing these proposed rules are 

discussed in section V.E. of this 

preamble. The Departments are of the 

view that none of these alternatives 

would both achieve the policy 

objectives and goals of these proposed 

rules as previously stated and be less 

burdensome to small entities. For 

example, although the proposals 

pertaining to the open negotiation 

notice and response, initiation notice 

and response, selection form and 

response, and withdrawal form and 

response may impose costs on small 

entities, these proposals are critical to 

ensure the exchange of information 

between the parties in a standardized 

time and format, in order to reduce 

wasted effort for the parties at other 

stages of the Federal IDR process due to 

inappropriately or incorrectly initiated 

open negotiations or Federal IDR 

process disputes. Although the 

Departments recognize that the less 

stringent timetables considered in 

certain regulatory alternatives described 

in section V.E. of this preamble may 

account for the resources available to 

small entities, they would be contrary to 

the policy objectives of these proposed 

rules. Alternative timelines for small 

entities for any of the policy proposals 

described in these rules were not 

considered. The Departments did not 

identify any alternatives to these 

proposals that would be less 

burdensome to small entities while still 

achieving the objectives of these 

proposed rules. In addition, the 

proposals pertaining to the 

administrative fee may impose costs on 

small entities, but the proposed $150 

administrative fee amount in these 

proposed rules for disputes initiated on 

or after January 1, 2025 is the same as 

the proposed administrative fee amount 

for disputes initiated on or after January 

1, 2024,262 and these proposed rules 

further propose to reduce the 

administrative fee amount for both 

parties in low-dollar disputes and noninitiating parties in ineligible disputes. 

Therefore, although some of the 

regulatory alternatives considered may 

have led to minor reduction in burden 

to small entities, we believe they would 

ultimately undermine the proposals to 

reduce the cost to initiate a Federal IDR 

process dispute for small entities in 

certain situations, which we believe will 

confer a far greater benefit to small 

entities. 

For a more detailed discussion of the 

regulatory alternatives considered, 

please reference section V.E. of this 

preamble. 

6. Small Rural Hospitals 

In addition, section 1102(b) of the 

Social Security Act requires the 

Departments to prepare a regulatory 

impact analysis if a rule may have a 

significant impact on the operations of 

a substantial number of small rural 

hospitals. This analysis must conform to 

the provisions of section 603 of the 

RFA. For purposes of section 1102(b) of 

the Act, the Departments define a small 

rural hospital as a hospital that is 

located outside of a metropolitan 

statistical area and has fewer than 100 

beds. The Departments have determined 

that these proposed rules will not affect 

small rural hospitals and that these 

proposed rules are not subject to section 

1102(b) of the Act. Therefore, the 

Secretary certifies that these proposed 

rules will not have a significant 

economic impact on a substantial 

number of small rural hospitals. 

H. Special Analyses—Department of the 

Treasury 

Pursuant to the Memorandum of 

Agreement, Review of Treasury 

Regulations under Executive Order 

12866 (June 9, 2023), tax regulatory 

actions issued by the IRS are not subject 

to the requirements of section 6 of 

Executive Order 12866, as amended. 

Therefore, a regulatory impact 

assessment is not required. Pursuant to 

section 7805(f) of the Code, these 

regulations have been submitted to the 

Chief Counsel for Advocacy of the Small 

Business Administration for comment 

on their impact on small business. 

I. Unfunded Mandates Reform Act 

Section 202 of the Unfunded 

Mandates Reform Act of 1995 (UMRA) 

requires that agencies assess anticipated 

costs and benefits and take certain other 

actions before issuing a proposed rule or 

any final rule for which a general notice 

of proposed rulemaking was published 

that includes any Federal mandate that 

may result in expenditures in any 1 year 

by State, local, or tribal governments, in 

the aggregate, or by the private sector, of 

$100 million in 1995 dollars, updated 

annually for inflation. That threshold is 

approximately $177 million in 2023. As 

discussed earlier in the RIA, plans, 

issuers, TPAs, certified IDR entities, and 

providers, facilities, and providers of air 

ambulance services would incur costs to 

comply with the proposed provisions of 

these proposed rules. The Departments 

estimate the combined impact on State, 

local, or tribal governments and the 

private sector would not be above the 

threshold. 

J. Federalism 

Executive Order 13132 outlines the 

fundamental principles of federalism. It 

requires adherence to specific criteria by 

Federal agencies in formulating and 

implementing policies that have 

‘‘substantial direct effects’’ on the 

States, the relationship between the 

national government and States, or on 

the distribution of power and 

responsibilities among the various 

levels of government. Federal agencies 

issuing regulations that have these 

federalism implications must consult 

with State and local officials and 

describe the extent of their consultation 

and the nature of the concerns of State 

and local officials in the preamble to 

these proposed rules. 

The Departments do not anticipate 

that these proposed rules would have 

any federalism implications or limit the 

policy-making discretion of the States in 

compliance with the requirement of 

Executive Order 13132. The 

Departments recognize that at least one 

State (and possibly more) currently 

require the use of CARCs and RARCs to 

communicate information related to the 

applicability of State balance billing 

laws. In these instances, these proposed 

rules would not infringe upon the 

State’s ability to continue to specify its 

requirements related to using CARCs 

and RARCs. 

State and local government health 

plans may be subject to the Federal IDR 

process where a specified State law or 

All-Payer Model Agreement does not 

apply. The No Surprises Act authorizes 

States to enforce the new requirements, 

including those related to balance 


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billing, for issuers, providers, facilities, 

and providers of air ambulance services, 

with HHS enforcing only in cases where 

the State has notified HHS that the State 

does not have the authority to enforce 

or is otherwise not enforcing, or HHS 

has made a determination that a State 

has failed to substantially enforce the 

requirements. However, in the 

Departments’ view, the federalism 

implications of these proposed rules are 

substantially mitigated because some 

States have their own process for 

determining the total amount payable 

under a plan or coverage for out-ofnetwork emergency services and to outof-network providers for patient visits to 

in-network facilities. Where a State has 

a specified State law, the State law, 

rather than the Federal IDR process, 

would apply. The Departments 

anticipate that some States, with their 

own process, may want to change their 

laws or adopt new laws in response to 

these proposed rules. The Departments 

anticipate that these States would incur 

a small incremental cost when making 

changes to their laws. 

In compliance with the requirement 

of Executive Order 13132 that agencies 

examine closely any policies that may 

have federalism implications or limit 

the policy making discretion of the 

States, the Departments have engaged in 

efforts to consult with and work 

cooperatively with affected States, 

including participating in conference 

calls with and attending conferences of 

the National Association of Insurance 

Commissioners and consulting with 

State insurance officials on an 

individual basis. 

While developing these rules, the 

Departments attempted to balance the 

States’ interests in regulating health 

insurance issuers with the need to 

ensure market stability. By doing so, the 

Departments complied with the 

requirements of Executive Order 13132. 

Laurie Bodenheimer, 

Associate Director, Healthcare and Insurance, 

Office of Personnel Management. 

Douglas W. O’Donnell, 

Deputy Commissioner for Services and 

Enforcement, Internal Revenue Service. 

Lisa M. Gomez, 

Assistant Secretary, Employee Benefits 

Security Administration, Department of 

Labor. 

Xavier Becerra, 

Secretary, Department of Health and Human 

Services. 

List of Subjects 

5 CFR Part 890 

Administrative practice and 

procedure, Government employees, 

Health facilities, Health insurance, 

Health professions, Reporting and 

recordkeeping requirements. 

26 CFR Part 54 

Excise taxes, Pensions, Reporting and 

recordkeeping requirements. 

29 CFR Part 2590 

Continuation coverage, Disclosure, 

Employee benefit plans, Group health 

plans, Health care, Health insurance, 

Medical child support, Reporting and 

recordkeeping requirements. 

45 CFR Part 149 

Balance billing, Health care, Health 

insurance, Reporting, and recordkeeping 

requirements, Surprise billing, State 

regulation of health insurance, and 

Transparency in coverage. 

OFFICE OF PERSONNEL 

MANAGEMENT 

For the reasons stated in the 

preamble, the Office of Personnel 

Management proposes to amend 5 CFR 

part 890 as set forth below: 

PART 890—FEDERAL EMPLOYEES 

HEALTH BENEFITS PROGRAM 

■ 1. The authority citation for part 890 

continues to read as follows: 

Authority: 5 U.S.C. 8913; Sec. 890.102 

also issued under sections 11202(f), 11232(e), 

and 11246(b) of Pub. L. 105–33, 111 Stat. 

251; Sec. 890.111 also issued under section 

1622(b) of Pub. L. 104–106, 110 Stat. 521 (36 

U.S.C. 5522); Sec. 890.112 also issued under 

section 1 of Pub. L. 110–279, 122 Stat. 2604 

(2 U.S.C. 2051); Sec. 890.113 also issued 

under section 1110 of Pub. L. 116–92, 133 

Stat. 1198 (5 U.S.C. 8702 note); Sec. 890.301 

also issued under section 311 of Pub. L. 111– 

3, 123 Stat. 64 (26 U.S.C. 9801); Sec. 

890.302(b) also issued under section 1001 of 

Pub. L. 111–148, 124 Stat. 119, as amended 

by Pub. L. 111–152, 124 Stat. 1029 (42 U.S.C. 

300gg–14); Sec. 890.803 also issued under 50 

U.S.C. 3516 (formerly 50 U.S.C. 403p) and 22 

U.S.C. 4069c and 4069c–1; subpart L also 

issued under section 599C of Pub. L. 101– 

513, 104 Stat. 2064 (5 U.S.C. 5561 note), as 

amended; and subpart M also issued under 

section 721 of Pub. L. 105–261 (10 U.S.C. 

1108), 112 Stat. 2061; 25 U.S.C. 1647b. 

■ 2. Section 890.114 is amended by 

revising paragraph (a) to read as follows: 

§ 890.114 Surprise billing. 

(a) A carrier must comply with 

requirements described in 26 CFR 

54.9816–3, 54.9816–3T through 

54.9816–6T, 54.9816–6A, 54.9816–6, 

54.9816–8T, 54.9816–8, 54.9817–1T, 

54.9817–2, 54.9817–2T, 54.9822–1T, 

and 54.9825–3T through 6T; 29 CFR 

2590.716–3 through 2590.716–6, 

2590.716–6A, 2590.716–8, 2590.717–1, 

2590.717–2, 2590.722, 2590.725–1 

through 2590.725–4; and 45 CFR 149.30, 

149.100, 149.110 through 149.140, 

149.310, 149.510 through 530, and 

149.710 through 149.740 in the same 

manner as such provisions apply to a 

group health plan or health insurance 

issuer offering group or individual 

health insurance coverage, subject to 5 

U.S.C. 8902(m)(1), and the provisions of 

the carrier’s contract. For purposes of 

application of such sections, all carriers 

are deemed to offer health benefits in 

the large group market. 

* * * * * 

DEPARTMENT OF THE TREASURY 

INTERNAL REVENUE SERVICE 

Accordingly, the Treasury Department 

and the IRS propose to amend 26 CFR 

part 54 as follows: 

PART 54—PENSION EXCISE TAXES 

■ 3. The authority citation for part 54 is 

amended by adding entries for 

§§ 54.9816–3, 54.9816–6A and 54.9816– 

9 in numerical order to read in part as 

follows: 

Authority: 26 U.S.C. 7805 * * * 

* * * * * 

Section 54.9816–3 also issued under 26 

U.S.C. 9816. 

Section 54.9816–6A also issued under 26 

U.S.C. 9816. 

Section 54.9816–9 also issued under 26 

U.S.C. 9816. 

* * * * * 

■ 4. Section 54.9816–3 is added to read 

as follows: 

§ 54.9816–3 Definitions. 

(a) The definitions in § 54.9801–2 

apply to §§ 54.9816–4 through 54.9816– 

9, 54.9817–1, 54.9817–2, and 54.9822– 

1, unless otherwise specified. In 

addition, for purposes of §§ 54.9816–4 

through 54.9816–9, 54.9817–1, 54.9817– 

2, and 54.9822–1, the following 

definition applies: 

Bundled payment arrangement means 

an arrangement under which— 

(1) A provider, facility, or provider of 

air ambulance services bills for multiple 

items and/or services furnished to a 

single patient under a single service 

code that represents multiple items or 

services (for example, a DiagnosisRelated Group (DRG) code); or 

(2) A plan or issuer makes an initial 

payment or notice of denial of payment 

to a provider, facility, or provider of air 

ambulance services under a single 

service code that represents multiple 

items or services furnished to a single 

patient (for example, a DRG code). 

(b) For further guidance, see 

§ 54.9816–3T. 

■ 5. Section 54.9816–3T is amended 

by— 

■ a. Revising the introductory text; and 


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■ b. Adding the definition of ‘‘Bundled 

payment arrangement’’ in alphabetical 

order. 

The revisions and additions read as 

follows: 

§ 54.9816–3T Definitions (temporary). 

For further guidance, see § 54.9816–3 

introductory text; 

* * * * * 

Bundled payment arrangement has 

the meaning given in § 54.9816–3(a). 

* * * * * 

■ 6. Section 54.9816–6A is added to 

read as follows: 

§ 54.9816–6A Use of Claim Adjustment 

Reason Codes and Remittance Advice 

Remark Codes. 

(a) In general. When providing any 

paper or electronic remittance advice to 

an entity that does not have a 

contractual relationship directly or 

indirectly with a group health plan or a 

health insurance issuer offering group or 

individual health insurance coverage 

with respect to the furnishing of the 

item or service under the plan or 

coverage in response to a claim for 

payment for health care items and 

services furnished by that entity, the 

plan or issuer must use claim 

adjustment reason codes (CARCs) and 

remittance advice remark codes 

(RARCs) (see 45 CFR 162.1602 and 

162.1603) as specified in guidance 

issued by the Secretaries of the 

Treasury, Labor, and Health and Human 

Services, or as required under any 

applicable adopted standards and 

operating rules under 45 CFR part 162, 

to communicate information related to 

whether the claim is or is not subject to 

the provisions of this part and 45 CFR 

part 149, subpart E. 

(b) Severability. (1) Any provision of 

this section held to be invalid or 

unenforceable by its terms, or as applied 

to any person or circumstance, shall be 

construed so as to continue to give 

maximum effect to the provision 

permitted by law, unless such holding 

shall be one of utter invalidity or 

unenforceability, in which event the 

provision shall be severable from this 

section and shall not affect the 

remainder thereof or the application of 

the provision to persons not similarly 

situated or to dissimilar circumstances. 

(2) The provisions in § 54.9816–6A 

are intended to be severable from the 

provisions in §§ 54.9816–6, 54.9816–6T, 

54.9816–8, 54.9816–8T, and 54.9816–9, 

from any grant of forbearance from 

removal resulting from this subpart, and 

from any provision referenced in 

§§ 54.9816–6, 54.9816–6T, 54.9816–8, 

54.9816–8T, and 54.9816–9. 

■ 7. Section 54.9816–6 is amended by 

adding a heading to paragraph (a), 

revising paragraphs (b), (c), and (d) and 

adding paragraph (h) to read as follows: 

§ 54.9816–6 Methodology for calculating 

qualifying payment amount. 

(a) Definitions. * * * 

(b) Methodology for calculation of 

median contracted rate. For further 

guidance, see § 54.9816–6T(b). 

(c) Methodology for calculation of the 

qualifying payment amount. For further 

guidance, see § 54.9816–6T(c). 

(d) Information to be shared about the 

qualifying payment amount. In cases in 

which the recognized amount, with 

respect to an item or service furnished 

by a nonparticipating provider or 

nonparticipating emergency facility, is 

the qualifying payment amount or the 

amount billed by the provider or 

facility, or if the amount on which cost 

sharing is based with respect to air 

ambulance services furnished by a 

nonparticipating provider of air 

ambulance services is the qualifying 

payment amount or the amount billed 

by the provider of air ambulance 

services, the plan must provide to the 

provider, facility, or provider of air 

ambulance services, as applicable, in 

writing, in paper or electronic form— 

(1) With an initial payment or notice 

of denial of payment under § 54.9816– 

4, § 54.9816–4T, § 54.9816–5, § 54.9816– 

5T, § 54.9817 or § 54.9817–T: 

(i) For further guidance, see 

§ 54.9816–6T(d)(i); 

(ii) If the qualifying payment amount 

is based on a downcoded service code 

or modifier— 

(A) A statement that the service code 

or modifier billed by the provider, 

facility, or provider of air ambulance 

services was downcoded; 

(B) An explanation of why the claim 

was downcoded, which must include a 

description of which service codes were 

altered, if any, and a description of 

which modifiers were altered, added, or 

removed, if any; and 

(C) The amount that would have been 

the qualifying payment amount had the 

service code or modifier not been 

downcoded. 

(iii) For further guidance, see 

§ 54.9816–6T(d)(1)(iii); 

(iv) A statement that— 

(A) If the provider, facility, or 

provider of air ambulance services, as 

applicable, wishes to initiate a 30- 

business-day open negotiation period 

for purposes of determining the out-ofnetwork rate, the provider, facility, or 

provider of air ambulance services must: 

(1) Contact the appropriate person or 

office to initiate open negotiation within 

30 business days of receiving the initial 

payment or notice of denial of payment, 

and 

(2) For disclosures required to be 

provided on or after [DATE 90 DAYS 

AFTER PUBLICATION OF FINAL 

REGULATIONS IN THE FEDERAL 

REGISTER] and once the open 

negotiation notice can be submitted 

through the Federal IDR portal, notify 

the Secretary as described under 

§ 54.9816–8(b)(1)(i); and 

(B) If the 30-business-day open 

negotiation period does not result in an 

agreement on the amount of payment 

the provider, facility, or provider of air 

ambulance services may generally 

initiate the Federal IDR process within 

4 business days after the end of the open 

negotiation period; 

(v) For disclosures required to be 

provided on or after [DATE 90 DAYS 

AFTER PUBLICATION OF FINAL 

REGULATIONS IN THE FEDERAL 

REGISTER], the legal business name of 

the group health plan (if any), the legal 

business name of the plan sponsor (if 

applicable), and the registration number 

assigned under § 54.9816–9, if the plan 

is registered under § 54.9816–9. 

(vi) For further guidance, see 

§ 54.9816–6T(d)(1)(vi); 

(2) In a timely manner upon request 

of the provider, facility, or provider of 

air ambulance services: 

(i) For further guidance, see 

§ 54.9816–6T(d)(2)(i) through (iv) 

(ii) [Reserved] 

* * * * * 

(h) Severability. (1) Any provision of 

this section held to be invalid or 

unenforceable by its terms, or as applied 

to any person or circumstance, shall be 

construed so as to continue to give 

maximum effect to the provision 

permitted by law, unless such holding 

shall be one of utter invalidity or 

unenforceability, in which event the 

provision shall be severable from this 

section and shall not affect the 

remainder thereof or the application of 

the provision to persons not similarly 

situated or to dissimilar circumstances. 

(2) The provisions in § 54.9816–6 are 

intended to be severable from the 

provisions in §§ 54.9816–6A, 54.9816– 

6T, 54.9816–8, 54.9816–8T, and 

54.9816–9, from any grant of 

forbearance from removal resulting from 

this subpart, and from any provision 

referenced in §§ 54.9816–6A, 54.9816–8, 

54.9816–8T, and 54.9816–9. 

■ 8. Section 54.9816–6T is amended by: 

■ a. Revising paragraphs (d) 

introductory text, (d)(1)(iv) and (v); 

■ b. Adding paragraph (d)(1)(vi); 

■ c. Revising paragraph (d)(2) 

introductory text; and 

■ d. Adding paragraph (h). 


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The additions read as follows: 

§ 54.9816–6T Methodology for calculating 

qualifying payment amount (temporary). 

* * * * * 

(d) For further guidance, see 

§ 54.9816–6(d) introductory text; 

(1) * * * 

(iv) For further guidance, see 

§ 54.9816–6(d)(1)(iv); and 

(v) For further guidance, see 

§ 54.9816–6(d)(1)(v); 

(vi) Contact information, including a 

telephone number and email address, 

for the appropriate person or office to 

initiate open negotiations for purposes 

of determining an amount of payment 

(including cost sharing) for such item or 

service. 

(2) For further information see 

§ 54.9816–6(d)(2): 

* * * * * 

(h) Severability. For further guidance, 

see § 54.9816–6(h). 

■ 9. Section 54.9816–8 is amended by 

revising paragraphs (a), (b), (c), (d), (e), 

(g), and (h), and adding paragraph (i) to 

read as follows: 

The revisions and additions read as 

follows: 

§ 54.9816–8 Independent dispute 

resolution process. 

(a) Scope and definitions—(1) Scope. 

For further guidance, see § 54.9816– 

8T(a)(1). 

(2) Definitions. For further guidance, 

see § 54.9816–8T(a)(2). Additionally, for 

purposes of this section, the following 

definitions apply: 

(i) Batched qualified IDR items and 

services means multiple qualified IDR 

items or services that are considered 

jointly as part of one payment 

determination by a certified IDR entity 

for purposes of the Federal IDR process 

in accordance with paragraph (c)(4) of 

this section. 

(ii) For further guidance, see 

§ 54.9816–8T(a)(2)(ii)–(xii). 

(b) Determination of payment amount 

through open negotiation and the 

initiation of the Federal IDR process— 

(1) Determination of payment amount 

through open negotiation—(i) In 

general. With respect to an item or 

service that meets the requirements of 

§ 54.9816–8T(a)(2)(xi)(A), the provider, 

facility, or provider of air ambulance 

services, or the group health plan or 

health insurance issuer offering group or 

individual health insurance coverage 

may, during the 30-business-day period 

beginning on the day the provider, 

facility, or provider of air ambulance 

services receives an initial payment or 

notice of denial of payment regarding 

the item or service, initiate an open 

negotiation period for purposes of 

determining the out-of-network rate for 

such item or service. To initiate the 

open negotiation period, a party must 

submit a written open negotiation notice 

with the content specified in paragraph 

(b)(1)(ii) of this section to the other 

party and to the Secretary in the manner 

specified in paragraph (b)(3) of this 

section. The 30-business-day open 

negotiation period begins on the day on 

which the party first submits the open 

negotiation notice and the remittance 

advice documentation specified in 

paragraph (b)(1)(ii)(A)(12) of this section 

to the other party and the Secretary. The 

party in receipt of the open negotiation 

notice must provide to the other party 

and to the Secretary in the manner 

specified in paragraph (b)(3) of this 

section as soon as practicable, but no 

later than the 15th business day of the 

30-business-day open negotiation 

period, a written notice and supporting 

documentation in response to the open 

negotiation notice, as specified in 

paragraph (b)(1)(iii)(A) of this section. 

(ii) Open negotiation notice—(A) 

Content. The open negotiation notice 

must include, with respect to the item 

or service that is the subject of the open 

negotiation notice, information about 

the item or service and the parties 

including: 

(1) Information sufficient to identify 

the provider, facility, or provider of air 

ambulance services, including the name 

and current contact information 

(including the legal business name, 

email address, phone number, and 

mailing address) as provided with the 

claim form submitted by the provider, 

facility, or air ambulance provider to the 

plan or issuer, and the National 

Provider Identifier (NPI); 

(2) Information sufficient to identify 

the plan or issuer, including the plan’s 

or issuer’s registration number, as 

required under § 54.9816–9, if the plan 

or issuer is registered under § 54.9816– 

9, or an attestation from the party 

submitting the open negotiation notice 

that the plan or issuer was not registered 

prior to the date it submitted the notice; 

the legal business name of the plan or 

issuer, as well as the current contact 

information (name, email address, 

phone number, and mailing address) of 

the plan or issuer as provided with the 

initial payment or notice of denial of 

payment; and if the party submitting the 

open negotiation notice is a plan or 

issuer, the plan type (for example, selfinsured or fully-insured); 

(3) The name and contact information 

(including the legal business name, 

email address, phone number, and 

mailing address) for any third party 

representing the party submitting the 

open negotiation notice, and an 

attestation that the third party has the 

authority to act on behalf of the party it 

represents in the open negotiation; 

(4) Information sufficient to identify 

the item or service, including: the 

date(s) the item or service was furnished 

and, if the party submitting the open 

negotiation notice is a provider, facility, 

or provider of air ambulance services, 

the date(s) that the provider, facility, or 

provider of air ambulance services 

received the initial payment or notice of 

denial of payment for the item or service 

from the plan or issuer; the type of item 

or service (specifically, whether the 

item or service is an emergency service 

as defined in § 54.9816–4T(c)(2)(i) or 

(ii), a non-emergency service as 

described in § 54.9816–5T(b), or an air 

ambulance service as defined in 

§ 54.9816–3T); whether the service is a 

professional service or facility-based 

service; the State where the item or 

service was furnished; the claim 

number; the service code; and 

information to identify the location 

where the item or service was furnished 

(such as, place of service code or bill 

type code); 

(5) The initial payment amount 

(including $0 if, for example, payment 

is denied); 

(6) The qualifying payment amount, if 

provided with the initial payment or 

notice of denial of payment or if the 

party submitting the open negotiation 

notice is a plan or issuer; 

(7) An offer of an out-of-network rate 

for each item or service; 

(8) If the party submitting the open 

negotiation notice is a plan or issuer, the 

amount of cost sharing imposed for the 

item or service, if any; 

(9) If the party submitting the open 

negotiation notice is a provider or 

facility, a statement that the items and 

services do not qualify for the notice 

and consent exception described at 45 

CFR 149.410(b) or § 149.420(c) through 

(i); 

(10) A statement that the provider, 

facility, or provider of air ambulance 

services was a nonparticipating 

provider, nonparticipating emergency 

facility, or nonparticipating provider of 

air ambulance services on the date the 

item or service was furnished; 

(11) General information listed in the 

standard open negotiation notice 

developed by the Secretary pursuant to 

paragraph (b)(3) of this section 

describing the open negotiation period 

and the Federal IDR process (including 

a description of the purpose of the open 

negotiation period and Federal IDR 

process and key deadlines in the open 

negotiation period and Federal IDR 

process); and 


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(12) A copy of the initial payment or 

notice of denial of payment or other 

remittance advice that is required to 

include the disclosures under 

§§ 54.9816–6T(d)(1) and 54.9816– 

6(d)(1), with respect to the item or 

service. 

(B) [Reserved] 

(iii) Open negotiation response 

notice—(A) Content. The response to 

the open negotiation notice must 

include, with respect to the item or 

service that is the subject of the open 

negotiation response notice, information 

about the item or service and the parties 

including: 

(1) Information sufficient to identify 

the provider, facility, or provider of air 

ambulance services, including the name 

and current contact information 

(including the legal business name, 

email address, phone number, and 

mailing address) as provided with the 

claim form submitted by the provider, 

facility, or provider of air ambulance 

services to the plan or issuer, and the 

NPI; 

(2) Information sufficient to identify 

the plan or issuer, including the plan’s 

or issuer’s registration number, as 

required under § 54.9816–9 if the plan 

or issuer is registered under § 54.9816– 

9, or an attestation from the party 

submitting the open negotiation 

response notice that the plan or issuer 

was not registered prior to the date it 

submitted the notice; the legal business 

name of the plan or issuer, as well as the 

current contact information (name, 

email address, phone number, and 

mailing address) of the plan or issuer as 

provided with the initial payment or 

notice of denial of payment; and if the 

party submitting the open negotiation 

response notice is a plan or issuer, the 

plan type (for example, self-insured or 

fully-insured); 

(3) The name and contact information 

(including the legal business name, 

email address, phone number, and 

mailing address) for any third party 

representing the party submitting the 

open negotiation response notice, and 

an attestation that the third party has 

the authority to act on behalf of the 

party it represents in the open 

negotiation; 

(4) Information sufficient to identify 

the item or service included in the open 

negotiation notice, including the date(s) 

the item or service was furnished, and 

if the party submitting the open 

negotiation response notice is a 

provider, facility, or provider of air 

ambulance services, the date(s) that the 

provider, facility, or provider of air 

ambulance services received the initial 

payment or notice of denial of payment 

for such item or service from the plan 

or issuer, and the claim number; 

(5) If the party submitting the open 

negotiation response notice is a plan or 

issuer, a statement as to whether it 

agrees that the initial payment amount 

(including $0 if, for example, payment 

is denied) and the qualifying payment 

amount reflected in the open 

negotiation notice accurately reflect the 

initial payment amount and qualifying 

payment amount disclosed with the 

initial payment for the item or service, 

and if not, or if the open negotiation 

notice indicates that the qualifying 

payment amount was not 

communicated by the plan or issuer 

with the initial payment or notice of 

denial of payment or other remittance 

advice, the initial payment amount 

(including $0 if, for example, payment 

is denied) and/or qualifying payment 

amount it believes to be correct, and 

documentation to support the statement 

(for example, the remittance advice 

confirming the qualifying payment 

amount); 

(6) If the party submitting the open 

negotiation response notice is a plan or 

issuer, the amount of cost sharing 

imposed for the item or service, if any; 

(7) A counteroffer for an out-ofnetwork rate for each item or service or 

an acceptance of the other party’s offer; 

(8) If the party submitting the open 

negotiation response notice is a provider 

or facility, a statement that the items 

and services do not qualify for the 

notice and consent exception described 

at 45 CFR 149.410(b) or 45 CFR 

149.420(c) through (i); 

(9) With respect to each item or 

service, either a statement and 

supporting documentation that explains 

why the item or service is not subject to 

the Federal IDR process or a statement 

agreeing that the item or service is 

subject to the Federal IDR process; 

(10) A statement as to whether any of 

the information provided in the open 

negotiation notice is inaccurate and the 

basis for the statement, as well as 

supporting documentation; and 

(11) A statement confirming that the 

initial payment or notice of denial of 

payment or other remittance advice 

provided by the party submitting the 

open negotiation notice under 

paragraph (b)(1)(ii)(A)(12) of this section 

is accurate, and if inaccurate, a copy of 

the accurate initial payment or notice of 

denial of payment or other remittance 

advice required to include the 

disclosures under § 54.9816–6(d)(1) and 

§ 54.9816–6T(d)(1), with respect to the 

item or service. 

(B) [Reserved] 

(2) Initiating the Federal IDR 

process—(i) In general. Either party may 

initiate the Federal IDR process with 

respect to a qualified IDR item or service 

for which the parties do not agree upon 

an out-of-network rate by the last day of 

the open negotiation period provided 

for under paragraph (b)(1) of this 

section. To initiate the Federal IDR 

process, a party (the initiating party) 

must submit a written notice of IDR 

initiation, consistent with paragraph 

(b)(2)(ii) of this section, to the other 

party to the dispute (the non-initiating 

party), and to the Secretary in the 

manner specified in paragraph (b)(3) of 

this section, during the 4-business-day 

period beginning on the first business 

day after the last day of the open 

negotiation period (unless it is 

otherwise required to be submitted in 

the timeframe specified in paragraph 

(c)(5)(vii)(C) of this section). The date of 

IDR initiation is the date that the 

Secretary receives the notice of IDR 

initiation described in paragraph 

(b)(2)(ii) of this section. 

(A) Exception for items and services 

provided by certain nonparticipating 

providers and facilities. A party may not 

initiate the Federal IDR process with 

respect to an item or service if, with 

respect to that item or service, the party 

knows (or reasonably should have 

known) that the provider or facility 

provided notice and received consent 

under 45 CFR 149.410(b) or 149.420(c) 

through (i). 

(B) [Reserved] 

(ii) Notice of IDR initiation—(A) 

Content. The notice of IDR initiation 

must include, with respect to the item 

or service that is the subject of the 

notice, information about the item or 

service and the parties including: 

(1) Information sufficient to identify 

the provider, facility, or provider of air 

ambulance services, including the name 

and current contact information 

(including the legal business name, 

email address, phone number, and 

mailing address), and the NPI; and if the 

initiating party is a provider, facility, or 

provider of air ambulance services, the 

Tax Identification Number (TIN); 

(2) Information sufficient to identify 

the plan or issuer, including the plan’s 

or issuer’s registration number, as 

required under § 54.9816–9 if the plan 

or issuer is registered under § 54.9816– 

9, or an attestation from the initiating 

party that the plan or issuer was not 

registered prior to the date that it 

submitted the notice; the legal business 

name of the plan or issuer, as well as the 

current contact information (name, 

email address, phone number, and 

mailing address) of the plan or issuer as 

provided with the initial payment or 

notice of denial of payment; and if the 

initiating party is a plan or issuer, the 


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plan type (for example, self-insured or 

fully-insured) and TIN (or, in the case 

of a plan that does not have a TIN, the 

TIN of the plan sponsor); 

(3) The name and contact information 

(including the legal business name, 

email address, phone number, and 

mailing address) for any third party 

representing the initiating party, and an 

attestation that the third party has the 

authority to act on behalf of the party it 

represents in the Federal IDR process; 

(4) Information sufficient to identify 

whether the dispute being initiated 

includes batched or bundled qualified 

IDR items or services as described in 

paragraph (c)(4) of this section; 

(5) Information sufficient to identify 

the qualified IDR item or service that is 

the subject of the notice of IDR 

initiation, including the date(s) the 

qualified IDR item or service was 

furnished; if the initiating party is a 

provider, facility, or provider of air 

ambulance services, the date(s) that the 

provider, facility, or provider of air 

ambulance services received the initial 

payment or notice of denial of payment 

for such item or service from the plan 

or issuer; the date the open negotiation 

period under paragraph (b)(1) of this 

section began; the type of item or 

service (specifically, whether the 

qualified IDR item or service is an 

emergency service as defined in 

§ 54.9816–4T(c)(2)(i) or (ii), a nonemergency service as described in 

§ 54.9816–5T(b), or an air ambulance 

service as defined in § 54.9816–3T); 

whether the service is a professional 

service or facility-based service; the 

State where the item or service was 

furnished; the claim number; the service 

code; and information to identify the 

location the item or service was 

furnished (including place of service 

code or bill type code); 

(6) The initial payment amount 

(including $0 if, for example, payment 

is denied); 

(7) The qualifying payment amount, if 

provided with the initial payment or 

notice of denial of payment or if the 

initiating party is a plan or issuer; 

(8) If the initiating party is a provider 

or facility, a statement that the items 

and services do not qualify for the 

notice and consent exception described 

at 45 CFR 149.410(b) or 45 CFR 

149.420(c) through (i); 

(9) A statement that the provider, 

facility, or provider of air ambulance 

services was a nonparticipating 

provider, nonparticipating emergency 

facility, or nonparticipating provider of 

air ambulance services on the date the 

item or service was furnished; 

(10) Attestation that the item or 

service under dispute is a qualified IDR 

item or service, and the basis for the 

attestation; 

(11) General information listed in the 

standard notice of IDR initiation 

developed by the Secretary pursuant to 

paragraph (b)(3) of this section 

describing the Federal IDR process 

(including a description of the purpose 

of the Federal IDR process and key 

deadlines in the Federal IDR process); 

(12) A copy of the initial payment or 

notice of denial of payment or other 

remittance advice that is required to 

include the disclosures under 

§ 54.9816–6(d)(1) and § 54.9816– 

6T(d)(1), with respect to the item or 

service; 

(13) Preferred certified IDR entity; and 

(14) A statement describing the key 

aspects of the claim, such as patient 

acuity or level of training of the 

provider, facility, or provider of air 

ambulance services that furnished the 

qualified IDR item or service, discussed 

by the parties during open negotiation 

that relate to the payment for the 

disputed claim, whether the reasons for 

initiating the Federal IDR process are 

different from the aspects of the claim 

discussed during the open negotiation 

period, and an explanation of why the 

party is initiating the Federal IDR 

process, including any of the 

permissible considerations described in 

paragraph (c)(5)(iii) of this section and 

§ 54.9817–2(b)(2) that serve as the 

party’s basis for initiating the Federal 

IDR process. 

(B) [Reserved] 

(iii) Notice of IDR initiation response. 

-The non-initiating party must provide 

to the initiating party and to the 

Secretary in the manner specified in 

paragraph (b)(3) of this section within 3 

business days after the date of IDR 

initiation, a written notice and 

supporting documentation in response 

to the notice of IDR initiation, as 

specified in paragraph (b)(2)(iii)(A) of 

this section. 

(A) Content. The notice of IDR 

initiation response must include, with 

respect to the item or service that is the 

subject of the notice, information about 

the item or service and the parties 

including: 

(1) Information sufficient to identify 

the provider, facility, or provider of air 

ambulance services, including the name 

and current contact information 

(including the legal business name, 

email address, phone number, and 

mailing address), and the NPI; and if the 

non-initiating party is a provider, 

facility, or provider of air ambulance 

services, the TIN; 

(2) Information sufficient to identify 

the plan or issuer, including the plan’s 

or issuer’s registration number, as 

required under § 54.9816–9 if the plan 

or issuer is registered under § 54.9816– 

9 or an attestation from the noninitiating party that the plan or issuer 

was not registered prior to the date that 

it submitted the notice; the legal 

business name of the plan or issuer, as 

well as the current contact information 

(name, email address, phone number, 

and mailing address) of the plan or 

issuer as provided with the initial 

payment or notice of denial of payment; 

and if the non-initiating party is a plan 

or issuer, the plan type (for example, 

self-insured or fully-insured) and TIN 

(or, in the case of a plan that does not 

have a TIN, the TIN of the plan 

sponsor); 

(3) The name and contact information 

(including the legal business name, 

email address, phone number, and 

mailing address) for any third party 

representing the non-initiating party, 

and an attestation that the third party 

has the authority to act on behalf of the 

party it represents in the Federal IDR 

process; 

(4) Information sufficient to identify 

each item or service included in the 

notice of IDR initiation, including the 

date(s) the item or service was 

furnished. If the non-initiating party is 

a provider, facility, or provider of air 

ambulance services, the date(s) that the 

provider, facility, or provider of air 

ambulance services received the initial 

payment or notice of denial of payment 

for such item or service from the plan 

or issuer, and the claim number; 

(5) If the non-initiating party is a plan 

or issuer, a statement as to whether the 

non-initiating party agrees that the 

initial payment (including $0 if, for 

example, payment is denied) and the 

qualifying payment amount reflected in 

the notice of IDR initiation are accurate 

for the item or service that is the subject 

of the dispute, and if not, the initial 

payment amount (including $0 if, for 

example, payment is denied) and/or 

qualifying payment amount it believes 

to be correct, and documentation to 

support the statement (for example, the 

remittance advice confirming the 

qualifying payment amount); 

(6) If the non-initiating party is a plan 

or issuer, the amount of cost sharing 

imposed for the item or service, if any; 

(7) If the non-initiating party is a 

provider or facility, a statement that the 

items and services do not qualify for the 

notice and consent exception described 

at 45 CFR 149.410(b) or 45 CFR 

149.420(c) through (i); 

(8) With respect to each item or 

service that is the subject of the dispute, 

either an attestation that the item or 

service is a qualified IDR item or 

service, or, for each item or service that 


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the non-initiating party asserts is not a 

qualified IDR item or service, an 

explanation and documentation to 

support the statement; 

(9) A statement confirming that the 

initial payment or notice of denial of 

payment or other remittance advice 

provided by the initiating party under 

paragraph (b)(2)(ii)(A)(12) of this section 

is accurate, and if inaccurate, a copy of 

the accurate initial payment or notice of 

denial of payment or other remittance 

advice required to include the 

disclosures under §§ 54.9816–6(d)(1) 

and 54.9816–6T(d)(1), with respect to 

the item or service; 

(10) A statement as to whether any of 

the information provided in the notice 

of IDR initiation is inaccurate and the 

basis for the statement as well as any 

supporting documentation; and 

(11) A statement as to whether the 

non-initiating party agrees or objects to 

the initiating party’s preferred certified 

IDR entity. If the non-initiating party 

objects to the initiating party’s preferred 

certified IDR entity, the notice of IDR 

initiation response must include the 

name of an alternative preferred 

certified IDR entity and, if applicable, 

an explanation of any conflict of interest 

with the initiating party’s preferred 

certified IDR entity . 

(B) [Reserved]. 

(3) Manner. A party furnishing notices 

as required under paragraphs (b)(1)(ii) 

and (iii), and (b)(2)(ii) and (iii) of this 

section must furnish the notices using 

the standard forms developed by the 

Secretary and must furnish the notices 

and supporting documentation to the 

other party and the Secretary, through 

the Federal IDR portal. 

(c) Federal IDR process following 

initiation—(1) Selection of certified IDR 

entity—(i) Preliminary selection of the 

certified IDR entity. Within 3 business 

days after the date of IDR initiation, the 

non-initiating party must agree or object 

to the preferred certified IDR entity 

identified in the notice of IDR initiation, 

as described in paragraph 

(b)(2)(iii)(A)(11) of this section. 

(A) If the non-initiating party agrees, 

or fails to object, to the selection of the 

initiating party’s preferred certified IDR 

entity in the manner described in 

paragraph (b)(2)(iii)(A)(11) of this 

section and within the timeframe 

specified in paragraph (c)(1)(i) of this 

section, the initiating party’s preferred 

certified IDR entity will be considered 

jointly selected on the third business 

day after the date of IDR initiation. 

(B) If the non-initiating party objects 

to the selection of the initiating party’s 

preferred certified IDR entity by 

designating an alternative preferred 

certified IDR entity in the manner 

described in paragraph (b)(2)(iii)(A)(11) 

of this section and within 3 business 

days after the date of IDR initiation, the 

initiating party may then agree or object 

to the non-initiating party’s alternative 

preferred certified IDR entity by 

submitting the notice of certified IDR 

entity selection in the manner specified 

in paragraph (c)(1)(i)(D) of this section. 

If the initiating party agrees to the noninitiating party’s alternative preferred 

certified IDR entity within 3 business 

days after the date of IDR initiation, or 

if the non-initiating party submits the 

notice of IDR initiation response on or 

before the second business day after the 

date of IDR initiation and the initiating 

party fails to respond within 3 business 

days after the date of IDR initiation, the 

alternative preferred certified IDR entity 

will be considered jointly selected by 

the parties. If the non-initiating party 

submits the notice of IDR initiation 

response on the third business day after 

the date of IDR initiation and the 

initiating party does not agree on the 

same day, selection will proceed under 

paragraph (c)(1)(i)(C) of this section. 

(C) If a certified IDR entity is not 

jointly selected under paragraph 

(c)(1)(i)(A) or (B) of this section, either 

party may select an alternative preferred 

certified IDR entity by submitting the 

notice of certified IDR entity selection in 

the manner specified in paragraph 

(c)(1)(i)(D) of this section, until the 

earlier of the date that the parties agree 

on the alternative preferred certified IDR 

entity or the deadline for joint selection, 

which is 3 business days after the date 

of IDR initiation. Once a party submits 

a notice of certified IDR entity selection, 

it may not submit another notice of 

certified IDR entity selection until after 

it receives a responding notice of 

certified IDR entity selection from the 

other party. 

(1) If a party submits a notice of 

certified IDR entity selection to the 

other party on the first or second day 

after the date of IDR initiation and the 

party in receipt of the notice agrees or 

fails to object to the alternative preferred 

certified IDR entity by the third business 

day after the date of IDR initiation, the 

alternative preferred certified IDR entity 

will be considered jointly selected by 

the parties. 

(2) If a party submits a notice of 

certified IDR entity selection to the 

other party on the third business day 

after the date of IDR initiation and the 

party last in receipt of the notice agrees 

to the alternative preferred certified IDR 

entity on the same day, the alternative 

preferred certified IDR entity will be 

considered jointly selected by the 

parties. 

(3) If a party submits a notice of 

certified IDR entity selection to the 

other party on the third business day 

after the date of IDR initiation and the 

party last in receipt of the notice does 

not agree to the alternative preferred 

certified IDR entity on the same day, the 

parties will have failed to jointly select 

a certified IDR entity. 

(D) To notify the other party and the 

Secretary of an agreement or objection 

to an alternative preferred certified IDR 

entity under paragraph(c)(1)(i)(C) of this 

section, a party must submit the notice 

of certified IDR entity selection. The 

party must furnish the notice of certified 

IDR entity selection using the standard 

form developed by the Secretary and 

must furnish the notice to the other 

party and the Secretary through the 

Federal IDR portal within 3 business 

days after the date of IDR initiation. 

However, in the event the conditions 

under paragraph (c)(1)(ii) of this section 

apply, the party may notify the 

Secretary of an agreement or objection 

to an alternative preferred certified IDR 

entity in accordance with paragraph 

(c)(1)(ii) of this section. The notice of 

certified IDR entity selection must 

include a statement indicating the 

party’s agreement with or objection to 

the other party’s alternative preferred 

certified IDR entity and, if applicable, 

an explanation of any conflict of interest 

with the alternative preferred certified 

IDR entity. If the party in receipt of a 

notice of certified IDR entity selection 

objects to the other party’s alternative 

preferred certified IDR entity and the 

party submits a notice of certified IDR 

entity selection by the end of the third 

business day after the date of IDR 

initiation, that party’s notice of certified 

IDR entity selection reflecting the 

objection must include the name of 

another alternative preferred certified 

IDR entity. 

(ii) Failure to jointly select a certified 

IDR entity. If the parties fail to jointly 

select a certified IDR entity within 3 

business days after the date of IDR 

initiation, the Secretary will select a 

certified IDR entity. The parties will 

have failed to jointly select a certified 

IDR entity if, by the end of the third 

business day after the date of IDR 

initiation, the party last in receipt of the 

notice of IDR initiation response or the 

notice of certified IDR entity selection 

has objected to the other party’s 

alternative preferred certified IDR 

entity, or if the notice of IDR initiation 

response or the notice of certified IDR 

entity selection is submitted to the other 

party on the third business day after the 

date of IDR initiation and the party in 

receipt of the notice does not agree to 

the alternative preferred certified IDR 


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entity within 3 business days after the 

date of IDR initiation. 

(A) In selecting the certified IDR 

entity, the Secretary will first confirm 

whether a party submitted the notice of 

IDR initiation response or the notice of 

certified IDR entity selection with an 

alternative preferred certified IDR entity 

on the third business day after the date 

of IDR initiation without the other 

party’s agreement to the selection. If 

either notice was provided on the third 

business day after the date of IDR 

initiation without the other party’s 

agreement to the alternative preferred 

certified IDR entity by the end of third 

business day after the date of IDR 

initiation, the Secretary will provide the 

party last in receipt of the applicable 

notice 2 additional business days to 

agree or object to the other party’s 

alternative preferred certified IDR entity 

selection. 

(1) If the party last in receipt of the 

notice of IDR initiation response or the 

notice of certified IDR entity selection 

agrees with the other party’s alternative 

preferred certified IDR entity and 

notifies the Secretary of the agreement 

or fails to notify the Secretary of its 

objection in the Federal IDR portal by 

the fifth business day after the date of 

IDR initiation, the Secretary will select 

the final alternative preferred certified 

IDR entity selected in the applicable 

notice. In disputes where the applicable 

notice was submitted on the third 

business day after the date of IDR 

initiation, the party last in receipt of the 

notice will not be allowed to select 

another alternative preferred certified 

IDR entity. 

(2) If the party notifies the Secretary 

of its objection to the alternative 

preferred certified IDR entity by the fifth 

business day after the date of IDR 

initiation, the Secretary will proceed 

with the random selection of the 

certified IDR entity from among the 

certified IDR entities (other than the 

preferred certified IDR entity and any 

alternative preferred certified IDR entity 

previously selected in such dispute by 

a party, unless there is no other certified 

IDR entity available to select) that 

charge a fee within the allowed range of 

certified IDR entity fees on the sixth 

business day after the date of IDR 

initiation. If there are insufficient 

certified IDR entities that charge a fee 

within the allowed range of certified 

IDR entity fees available to arbitrate the 

dispute, the Secretary will select a 

certified IDR entity that has received 

approval, as described in § 54.9816– 

8T(e)(2)(vii)(B), to charge a fee outside 

of the allowed range of certified IDR 

entity fees. In either case, the Secretary 

will notify the parties of the preliminary 

selection of the certified IDR entity not 

later than 6 business days after the date 

of IDR initiation. 

(B) [Reserved]. 

(iii) Date of preliminary selection of 

the certified IDR entity. The date of 

preliminary selection of the certified 

IDR entity will be: 

(A) Three business days after the date 

of IDR initiation if the parties jointly 

selected a certified IDR entity, as 

specified in paragraph (c)(1)(i) of this 

section; or 

(B) Six business days after the date of 

IDR initiation, if the parties fail to 

jointly select a certified IDR entity as 

specified in paragraph (c)(1)(ii) of this 

section. 

(iv) Final selection of certified IDR 

entity—(A) Conflict-of-interest review. 

The certified IDR entity preliminarily 

selected for a dispute must review the 

selection. The selection of the certified 

IDR entity will be finalized only if the 

certified IDR entity attests to the 

Secretary that it meets the following 

requirements: 

(1) The certified IDR entity does not 

have a conflict of interest as defined in 

§ 54.9816–8T(a)(2)(iv); 

(2) The certified IDR entity will only 

assign personnel to a dispute and make 

decisions regarding hiring, 

compensation, termination, promotion, 

or other similar matters related to 

personnel assigned to the dispute in a 

manner that is not based upon the 

likelihood that the assigned personnel 

will support a particular party to the 

dispute; and 

(3) The certified IDR entity will not 

assign any personnel to a dispute who 

would have any conflicts of interest, as 

defined in § 54.9816–8T(a)(2)(iv), 

regarding any party to the dispute or 

whose relationship with a party within 

the 1 year immediately preceding the 

assignment to the dispute would violate 

the restrictions on aiding or advising a 

former employer or principal in a 

manner similar to the restrictions set 

forth in 18 U.S.C. 207(b). 

(B) Failure to meet conflict-of-interest 

requirements. If the certified IDR entity 

notifies the Secretary within 3 business 

days of the date of preliminary selection 

of the certified IDR entity that it does 

not meet the requirements of paragraphs 

(c)(1)(iv)(A)(1) through (3) of this 

section or if the certified IDR entity does 

not respond within 3 business days after 

the date of preliminary selection of the 

certified IDR entity, the Secretary will 

randomly select another certified IDR 

entity consistent with paragraph 

(c)(1)(ii) of this section. The Secretary 

will notify the parties of the new 

randomly preliminarily selected 

certified IDR entity no later than 1 

business day after the previously 

selected certified IDR entity notifies the 

Secretary that it has a conflict of interest 

or, if the previously selected certified 

IDR entity fails to respond within 3 

business days after the date of 

preliminary selection of the certified 

IDR entity, no later than 1 business day 

after the end of the 3-business-day 

period. 

(C) Date of final selection of the 

certified IDR entity. If the certified IDR 

entity that has been preliminarily 

selected attests within 3 business days 

that it meets the requirements of 

paragraphs (c)(1)(iv)(A)(1) through (3) of 

this section, the Secretary will notify the 

parties of the final selection of the 

certified IDR entity no later than 1 

business day after the certified IDR 

entity attests that it meets the conflictof-interest requirements. The date of 

final selection of the certified IDR entity 

is the date that the Secretary provides 

this notice to the parties. 

(2) Federal IDR process eligibility 

review—(i) Federal IDR process 

eligibility determination by certified IDR 

entity. Unless the departmental 

eligibility review described in paragraph 

(c)(2)(ii) of this section applies, the 

selected certified IDR entity must 

review the information in the notice of 

IDR initiation, notice of IDR initiation 

response, and any additional 

information described in paragraph 

(c)(2)(iii) of this section, and make a 

final determination as to whether the 

item or service is a qualified IDR item 

or service, as defined in § 54.9816– 

8T(a)(2)(xi), that is eligible for the 

Federal IDR process. The certified IDR 

entity must make such a determination 

and notify the Secretary and both 

parties no later than 5 business days 

after the date of final selection of the 

certified IDR entity. If the certified IDR 

entity determines that the item or 

service is not a qualified IDR item or 

service, the dispute will be closed, and 

the selected certified IDR entity will not 

take any action with regard to the 

dispute. 

(ii) Departmental eligibility review for 

Federal IDR process eligibility 

determinations. When the conditions for 

the departmental eligibility review set 

forth in paragraph (c)(2)(ii)(A) of this 

section are met, the Secretary will 

conduct the eligibility review and make 

the eligibility determination instead of 

the certified IDR entity. If the Secretary 

determines that the item or service is 

not a qualified IDR item or service, the 

dispute will be closed, and the selected 

certified IDR entity will not take any 

action with regard to the dispute. If the 

dispute is found to be eligible, the 

Secretary will inform the preliminarily 


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selected certified IDR entity of the 

dispute’s eligibility so that it may 

conduct its conflict-of-interest 

assessment, and the dispute will 

otherwise continue through the Federal 

IDR process, including notification of 

the eligibility determination to the 

disputing parties by the preliminarily 

selected certified IDR entity. 

(A) Application of the departmental 

eligibility review. The departmental 

eligibility review will apply when the 

Secretary determines that any of the 

extenuating circumstances described in 

paragraph (g)(1) of this section require 

application of the departmental 

eligibility review to facilitate timely 

payment determinations or the effective 

processing of disputes under the Federal 

IDR process. 

(B) Notification regarding 

applicability of the departmental 

eligibility review. Before invoking the 

application of the departmental 

eligibility review, the Secretary will 

post advance public notification of the 

date on which the departmental 

eligibility review will take effect and the 

reasons for invoking the application of 

the departmental eligibility review. 

Before ending the application of the 

departmental eligibility review, the 

Secretary will post advance public 

notification of the date on which the 

departmental eligibility review will no 

longer be in effect and the reasons for 

ending the application of the 

departmental eligibility review. 

(iii) Request for additional 

information. The Secretary or the 

selected certified IDR entity may request 

additional information from either party 

to a dispute at any time, including for 

the purpose of assessing whether a 

conflict of interest exists, conducting an 

eligibility determination, or making a 

payment determination. 

(A) Upon request, a party must submit 

the additional information within 5 

business days to the Secretary or the 

selected certified IDR entity, as 

applicable, through the Federal IDR 

portal. Following a request for 

additional information, the time period 

for the applicable stage of the Federal 

IDR process will be tolled until the 

earlier of the date either all of the 

requested information is provided or the 

5-business-day period expires, and each 

subsequent timeframe in the Federal 

IDR process will be determined based 

on the date of completion of the stage 

of the Federal IDR process that was 

tolled for provision of the requested 

information. 

(B) If a party fails to submit the 

additional information as required, the 

related determination, including the 

eligibility determination, conflict-ofinterest review, or payment 

determination will be made without the 

requested information unless a goodcause extension of the 5-business-day 

period, as specified in paragraph 

(g)(1)(i) of this section, has been 

provided, and the party subsequently 

submits the additional information 

requested within the extended period. 

(3) Authority to continue negotiations 

or withdraw—(i) Authority to continue 

to negotiate. If the parties to the Federal 

IDR process agree on an out-of-network 

rate for a qualified IDR item or service 

after providing the notice of IDR 

initiation to the Secretary required 

under paragraph (b)(2)(ii) of this section, 

but before the certified IDR entity has 

made its payment determination, the 

amount agreed to by the parties for the 

qualified IDR item or service will be 

treated as the out-of-network rate for the 

qualified IDR item or service. To the 

extent the amount exceeds the initial 

payment amount and any cost sharing 

paid or required to be paid by the 

participant, beneficiary, or enrollee, or 

there was an initial denial of payment, 

payment must be made directly by the 

plan or issuer to the nonparticipating 

provider, nonparticipating facility, or 

nonparticipating provider of air 

ambulance services not later than 30 

business days after the agreement is 

reached. In no instance may either party 

seek additional payment from the 

participant, beneficiary, or enrollee, 

including in instances in which the outof-network rate exceeds the qualifying 

payment amount. The initiating party 

must send a notification to the Secretary 

and to the certified IDR entity (if 

selected) electronically, through the 

Federal IDR portal, as soon as possible, 

but no later than 3 business days after 

the date of the agreement. The 

notification must include the dispute 

number, a statement of the out-ofnetwork rate for the qualified IDR item 

or service, and signatures from 

authorized signatories for both parties. 

(ii) Withdrawals. A dispute may be 

withdrawn from the Federal IDR process 

by the initiating party, the Secretary, or 

a certified IDR entity before a payment 

determination is made if one of the 

following conditions is met: 

(A) The initiating party provides 

notification through the Federal IDR 

portal to the Secretary and the certified 

IDR entity (if selected) that both parties 

to the dispute agree to withdraw the 

dispute from the Federal IDR process 

without agreement on an out-of-network 

rate. The notification must include the 

dispute number, a statement about both 

parties’ agreement to withdraw, and 

signatures from authorized signatories 

for both parties. 

(B) The initiating party provides a 

standard withdrawal request notice 

through the Federal IDR portal to the 

Secretary, the certified IDR entity (if 

selected), and the non-initiating party of 

its request to withdraw the dispute from 

the Federal IDR process and the noninitiating party notifies the Secretary, 

certified IDR entity (if selected), and the 

initiating party through the Federal IDR 

portal of its agreement to withdraw from 

the Federal IDR process within 5 

business days of the initiating party’s 

request. If the non-initiating party fails 

to respond within 5 business days of the 

initiating party’s request, the noninitiating party will be considered to 

have agreed to the withdrawal, and the 

dispute will be withdrawn. 

(C) The certified IDR entity or 

Secretary cannot determine eligibility 

because both parties to the dispute are 

unresponsive to any requests for 

additional information to determine 

eligibility as described in paragraph 

(c)(2)(iii) of this section, or 

(D) The certified IDR entity cannot 

make a payment determination because 

both parties to the dispute have failed 

to submit an offer as described in 

paragraph (c)(5)(i) of this section. 

(4) Treatment of batched qualified 

IDR items and services—(i) In general. A 

certified IDR entity may consider up to 

25 qualified IDR items and services 

jointly as part of one payment 

determination that is subject to the 

certified IDR entity fee for batched 

determinations only if the qualified IDR 

items and services meet the 

requirements of this paragraph (c)(4)(i). 

(A) For further guidance, see 

§ 54.9816–8T(c)(4)(i)(A); 

(B) Payment for the qualified IDR 

items and services is required to be 

made by the same group health plan or 

health insurance issuer. For group or 

individual health insurance coverage, 

this requirement is satisfied if the same 

issuer is required to make payment for 

the qualified IDR items and services, 

even if the qualified IDR items and 

services relate to claims from different 

group health plans or individual market 

policies. For self-insured group health 

plans, this requirement is satisfied if the 

same self-insured group health plan is 

required to make payment for the 

qualified IDR items and services, 

including when the plan makes 

payments through a third party 

administrator; the requirement is not 

satisfied if multiple self-insured group 

health plans are required to make 

payments for the qualified IDR items 

and services, even if those group health 

plans make payments through the same 

third party administrator; 


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(C) The qualified IDR items and 

services meet any of the following 

criteria under which multiple qualified 

IDR items and services relate to the 

treatment of a similar condition and 

therefore are permitted to be considered 

jointly as a single payment 

determination for purposes of 

encouraging efficiencies (including 

minimizing costs) in the Federal IDR 

process: 

(1) The qualified IDR items or services 

were furnished to a single patient 

during the same patient encounter. For 

purposes of this section, a single patient 

encounter is defined as a patient 

encounter on one or more consecutive 

days during which the qualified IDR 

items or services were furnished to the 

same patient and billed on the same 

claim form; or 

(2) The qualified IDR items and 

services were furnished to one or more 

patients and were billed under the same 

service code or a comparable code 

under a different procedural coding 

system, such as Current Procedural 

Terminology (CPT) codes with 

modifiers, if applicable, Healthcare 

Common Procedure Coding System 

(HCPCS) codes with modifiers, if 

applicable, or Diagnosis-Related Group 

(DRG) codes with modifiers, if 

applicable; or 

(3) For anesthesiology, radiology, 

pathology, and laboratory qualified IDR 

items and services, the qualified IDR 

items and services were furnished to 

one or more patients and were billed 

under service codes belonging to the 

same Category I CPT code range, as 

specified in guidance published by the 

Secretary; and 

(D) All the qualified IDR items and 

services were furnished within the same 

30-business-day period following the 

date on which the first item or service 

included in the batched determination 

was furnished and were the subjects of 

a 30-business-day open negotiation 

period that ended within 4 business 

days of IDR initiation, except as 

provided in paragraph (c)(5)(vii) of this 

section. 

(ii) Treatment of bundled payment 

arrangements. Qualified IDR items and 

services that meet the definition of a 

bundled payment arrangement under 

§ 54.9816–3 may be submitted and 

considered as a single payment 

determination, and the certified IDR 

entity must make a single payment 

determination for the multiple qualified 

IDR items and services included in the 

bundled payment arrangement. Bundled 

payment arrangements as defined in 

§ 54.9816–3 and submitted under this 

paragraph (c)(4)(ii) are subject to the 

certified IDR entity fee for single 

determinations. 

(5) Payment determination for a 

qualified IDR item or service—(i) 

Submission of offers. Not later than 10 

business days after the date of final 

selection of the certified IDR entity as 

described in paragraph (c)(1)(iv)(C) of 

this section (or not later than 10 

business days after the qualified IDR 

items and services are determined 

eligible as described in paragraph (c)(2) 

of this section, when the Secretary 

determines that any of the extenuating 

circumstances described in paragraph 

(g)(1)(ii) of this section apply), the plan 

or issuer and the provider, facility, or 

provider of air ambulance services: 

(A) For further guidance, see 

§ 54.9816–8T(c)(5)(i)(A). 

(B) For further guidance, see 

§ 54.9816–8T(c)(5)(i)(B); 

(ii) Payment determination and 

notification. Not later than 30 business 

days after the date of final selection of 

the certified IDR entity as described in 

paragraph (c)(1)(iv)(C) of this section (or 

not later than 30 business days after the 

qualified IDR items and services are 

determined eligible as described in 

paragraph (c)(2) of this section, when 

the Secretary determines that any of the 

extenuating circumstances described in 

paragraph (g) of this section apply), the 

certified IDR entity must: 

(A) Select as the out-of-network rate 

for the qualified IDR item or service one 

of the offers submitted under paragraph 

(c)(5)(i) of this section, weighing only 

the considerations specified in 

paragraph (c)(5)(iii) of this section (as 

applied to the information provided by 

the parties pursuant to § 54.9816– 

8T(c)(5)(i)). The certified IDR entity 

must select the offer that the certified 

IDR entity determines best represents 

the value of the qualified IDR item or 

service as the out-of-network rate. 

(1) Prevailing party. In the case of 

single determinations, the party whose 

offer is selected by the certified IDR 

entity is considered the prevailing party. 

In the case of batched determinations, 

the party with the most determinations 

in its favor is considered the prevailing 

party; if each party prevails in an equal 

number of determinations, neither party 

will be considered the prevailing party, 

and the certified IDR entity fee will be 

split evenly between the parties. 

(2) Non-prevailing party. In the case of 

single determinations, the party whose 

offer is not selected by the certified IDR 

entity is considered the non-prevailing 

party. In the case of batched 

determinations, the party with the 

fewest determinations in its favor is 

considered the non-prevailing party. 

(B) For further guidance, see 

§ 54.9816–8T(c)(5)(ii)(B). 

(iii) Considerations in determination. 

In determining which offer to select: 

(A) The certified IDR entity must 

consider the qualifying payment 

amount(s) for the applicable year for the 

same or similar item or service. 

(B) The certified IDR entity must then 

consider information submitted by a 

party that relates to the following 

circumstances: 

(1) The level of training, experience, 

and quality and outcomes 

measurements of the provider or facility 

that furnished the qualified IDR item or 

service (such as those endorsed by the 

consensus-based entity authorized in 

section 1890 of the Social Security Act). 

(2) The market share held by the 

provider or facility or that of the plan 

or issuer in the geographic region in 

which the qualified IDR item or service 

was provided. 

(3) The acuity of the participant or 

beneficiary receiving the qualified IDR 

item or service, or the complexity of 

furnishing the qualified IDR item or 

service to the participant or beneficiary. 

(4) The teaching status, case mix, and 

scope of services of the facility that 

furnished the qualified IDR item or 

service, if applicable. 

(5) Demonstration of good faith efforts 

(or lack thereof) made by the provider 

or facility or the plan or issuer to enter 

into network agreements with each 

other, and, if applicable, contracted 

rates between the provider or facility, as 

applicable, and the plan or issuer, as 

applicable, during the previous 4 plan 

years. 

(C) The certified IDR entity must also 

consider information provided by a 

party in response to a request by the 

certified IDR entity under § 54.9816– 

8T(c)(4)(i)(A)(2) that relates to the offer 

for the payment amount for the 

qualified IDR item or service that is the 

subject of the payment determination 

and that does not include information 

on factors described in § 54.9816– 

8T(c)(4)(v). 

(D) The certified IDR entity must also 

consider additional information 

submitted by a party that relates to the 

offer for the payment amount for the 

qualified IDR item or service that is the 

subject of the payment determination 

and that does not include information 

on factors described in § 54.9816– 

8T(c)(4)(v). 

(E) In weighing the considerations 

described in paragraphs (c)(4)(iii)(B) 

through (D) of this section, the certified 

IDR entity should evaluate whether the 

information is credible and relates to the 

offer submitted by either party for the 

payment amount for the qualified IDR 


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item or service that is the subject of the 

payment determination. The certified 

IDR entity should not give weight to 

information to the extent it is not 

credible, it does not relate to either 

party’s offer for the payment amount for 

the qualified IDR item or service, or it 

is already accounted for by the 

qualifying payment amount under 

paragraph (c)(4)(iii)(A) of this section or 

other credible information under 

paragraphs (c)(4)(iii)(B) through (D) of 

this section. 

(iv) Examples. The rules of paragraph 

(c)(4)(iii) of this section are illustrated in 

the following paragraphs. Each example 

assumes that the Federal IDR process 

applies for purposes of determining the 

out-of-network rate, that both parties 

have submitted the information parties 

are required to submit as part of the 

Federal IDR process, and that the 

submitted information does not include 

information on factors described in 

paragraph (c)(4)(v) of this section: 

(A) Example 1—(1) Facts. A level 1 

trauma center that is a nonparticipating 

emergency facility and an issuer are 

parties to a payment determination in 

the Federal IDR process. The facility 

submits an offer that is higher than the 

qualifying payment amount. The facility 

also submits additional written 

information showing that the scope of 

services available at the facility was 

critical to the delivery of care for the 

qualified IDR item or service provided, 

given the particular patient’s acuity. 

This information is determined to be 

credible by the certified IDR entity. 

Further, the facility submits additional 

information showing the contracted 

rates used to calculate the qualifying 

payment amount for the qualified IDR 

item or service were based on a level of 

service that is typical in cases in which 

the services are delivered by a facility 

that is not a level 1 trauma center and 

that does not have the capability to 

provide the scope of services provided 

by a level 1 trauma center. This 

information is also determined to be 

credible by the certified IDR entity. The 

issuer submits an offer equal to the 

qualifying payment amount. No 

additional information is submitted by 

either party. The certified IDR entity 

determines that all the information 

submitted by the nonparticipating 

emergency facility relates to the offer for 

the payment amount for the qualified 

IDR item or service that is the subject of 

the payment determination. 

(2) Conclusion. In this paragraph 

(c)(4)(iv)(A) (Example 1), the certified 

IDR entity must consider the qualifying 

payment amount. The certified IDR 

entity then must consider the additional 

information submitted by the 

nonparticipating emergency facility, 

provided the information relates to 

circumstances described in paragraphs 

(c)(4)(iii)(B) through (D) of this section 

and relates to the offer for the payment 

amount for the qualified IDR item or 

service that is the subject of the 

payment determination. If the certified 

IDR entity determines that it is 

appropriate to give weight to the 

additional credible information 

submitted by the nonparticipating 

emergency facility and that the 

additional credible information 

submitted by the facility demonstrates 

that the facility’s offer best represents 

the value of the qualified IDR item or 

service, the certified IDR entity should 

select the facility’s offer. 

(B) Example 2—(1) Facts. A 

nonparticipating provider and an issuer 

are parties to a payment determination 

in the Federal IDR process. The provider 

submits an offer that is higher than the 

qualifying payment amount. The 

provider also submits additional written 

information regarding the level of 

training and experience the provider 

possesses. This information is 

determined to be credible by the 

certified IDR entity, but the certified IDR 

entity finds that the information does 

not demonstrate that the provider’s level 

of training and experience relates to the 

offer for the payment amount for the 

qualified IDR item or service that is the 

subject of the payment determination 

(for example, the information does not 

show that the provider’s level of 

training and experience was necessary 

for providing the qualified IDR service 

that is the subject of the payment 

determination to the particular patient, 

or that the training or experience made 

an impact on the care that was 

provided). The nonparticipating 

provider does not submit any additional 

information. The issuer submits an offer 

equal to the qualifying payment amount, 

with no additional information. 

(2) Conclusion. In this paragraph 

(c)(4)(iv)(B) (Example 2), the certified 

IDR entity must consider the qualifying 

payment amount. The certified IDR 

entity must then consider the additional 

information submitted by the 

nonparticipating provider, provided the 

information relates to circumstances 

described in paragraphs (c)(4)(iii)(B) 

through (D) of this section and relates to 

the offer for the payment amount for the 

qualified IDR item or service that is the 

subject of the payment determination. In 

addition, the certified IDR entity should 

not give weight to information to the 

extent it is already accounted for by the 

qualifying payment amount or other 

credible information under paragraphs 

(c)(4)(iii)(B) through (D) of this section. 

If the certified IDR entity determines 

that the additional information 

submitted by the provider is credible 

but does not relate to the offer for the 

payment amount for the qualified IDR 

service that is the subject of the 

payment determination, and determines 

that the issuer’s offer best represents the 

value of the qualified IDR service, in the 

absence of any other credible 

information that relates to either party’s 

offer, the certified IDR entity should 

select the issuer’s offer. 

(C) Example 3—(1) Facts. A 

nonparticipating provider and an issuer 

are parties to a payment determination 

in the Federal IDR process involving an 

emergency department visit for the 

evaluation and management of a patient. 

The provider submits an offer that is 

higher than the qualifying payment 

amount. The provider also submits 

additional written information showing 

that the acuity of the patient’s condition 

and complexity of the qualified IDR 

service furnished required the taking of 

a comprehensive history, a 

comprehensive examination, and 

medical decision making of high 

complexity. This information is 

determined to be credible by the 

certified IDR entity. The issuer submits 

an offer equal to the qualifying payment 

amount for CPT code 99285, which is 

the CPT code for an emergency 

department visit for the evaluation and 

management of a patient requiring a 

comprehensive history, a 

comprehensive examination, and 

medical decision making of high 

complexity. The issuer also submits 

additional written information showing 

that this CPT code accounts for the 

acuity of the patient’s condition. This 

information is determined to be credible 

by the certified IDR entity. The certified 

IDR entity determines that the 

information provided by the provider 

and issuer relates to the offer for the 

payment amount for the qualified IDR 

service that is the subject of the 

payment determination. Neither party 

submits any additional information. 

(2) Conclusion. In this paragraph 

(c)(4)(iv)(C) (Example 3), the certified 

IDR entity must consider the qualifying 

payment amount. The certified IDR 

entity then must consider the additional 

information submitted by the parties, 

but the certified IDR entity should not 

give weight to information to the extent 

it is already accounted for by the 

qualifying payment amount or other 

credible information under paragraphs 

(c)(4)(iii)(B) through (D) of this section. 

If the certified IDR entity determines the 

additional information on the acuity of 

the patient and complexity of the 

service is already accounted for in the 


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calculation of the qualifying payment 

amount, the certified IDR entity should 

not give weight to the additional 

information provided by the provider. If 

the certified IDR entity determines that 

the issuer’s offer best represents the 

value of the qualified IDR service, the 

certified IDR entity should select the 

issuer’s offer. 

(D) Example 4—(1) Facts. A 

nonparticipating emergency facility and 

an issuer are parties to a payment 

determination in the Federal IDR 

process. Although the facility is not 

participating in the issuer’s network 

during the relevant plan year, it was a 

participating facility in the issuer’s 

network in the previous 4 plan years. 

The issuer submits an offer that is 

higher than the qualifying payment 

amount and that is equal to the facility’s 

contracted rate (adjusted for inflation) 

for the previous year with the issuer for 

the qualified IDR service. The issuer 

also submits additional written 

information showing that the contracted 

rates between the facility and the issuer 

during the previous 4 plan years were 

higher than the qualifying payment 

amount submitted by the issuer, and 

that these prior contracted rates account 

for the case mix and scope of services 

typically furnished at the 

nonparticipating facility. The certified 

IDR entity determines this information 

is credible and that it relates to the offer 

submitted by the issuer for the payment 

amount for the qualified IDR service 

that is the subject of the payment 

determination. The facility submits an 

offer that is higher than both the 

qualifying payment amount and the 

contracted rate (adjusted for inflation) 

for the previous year with the issuer for 

the qualified IDR service. The facility 

also submits additional written 

information, with the intent to show 

that the case mix and scope of services 

available at the facility were integral to 

the service provided. The certified IDR 

entity determines this information is 

credible and that it relates to the offer 

submitted by the facility for the 

payment amount for the qualified IDR 

service that is the subject of the 

payment determination. Neither party 

submits any additional information. 

(2) Conclusion. In this paragraph 

(c)(4)(iv)(D) (Example 4), the certified 

IDR entity must consider the qualifying 

payment amount. The certified IDR 

entity then must consider the additional 

information submitted by the parties, 

but should not give weight to 

information to the extent it is already 

accounted for by the qualifying payment 

amount or other credible information 

under paragraphs (c)(4)(iii)(B) through 

(D) of this section. If the certified IDR 

entity determines that the information 

submitted by the facility regarding the 

case mix and scope of services available 

at the facility includes information that 

is also accounted for in the information 

the issuer submitted regarding prior 

contracted rates, then the certified IDR 

entity should give weight to that 

information only once. The certified IDR 

entity also should not give weight to the 

same information provided by the 

nonparticipating emergency facility in 

relation to any other factor. If the 

certified IDR entity determines that the 

issuer’s offer best represents the value of 

the qualified IDR service, the certified 

IDR entity should select the issuer’s 

offer. 

(E) Example 5—(1) Facts. A 

nonparticipating provider and an issuer 

are parties to a payment determination 

in the Federal IDR process regarding a 

qualified IDR service for which the 

issuer downcoded the service code that 

the provider billed. The issuer submits 

an offer equal to the qualifying payment 

amount (which was calculated using the 

downcoded service code). The issuer 

also submits additional written 

information that includes the 

documentation disclosed to the 

nonparticipating provider under 

§ 54.9816–6(d)(1)(ii) at the time of the 

initial payment (which describes why 

the service code was downcoded). The 

certified IDR entity determines this 

information is credible and that it 

relates to the offer for the payment 

amount for the qualified IDR service 

that is the subject of the payment 

determination. The provider submits an 

offer equal to the amount that would 

have been the qualifying payment 

amount had the service code not been 

downcoded. The provider also submits 

additional written information that 

includes the documentation disclosed to 

the nonparticipating provider under 

§ 54.9816–6(d)(1)(ii) at the time of the 

initial payment. Further, the provider 

submits additional written information 

that explains why the billed service 

code was more appropriate than the 

downcoded service code, as evidence 

that the provider’s offer, which is equal 

to the amount the qualifying payment 

amount would have been for the service 

code that the provider billed, best 

represents the value of the service 

furnished, given its complexity. The 

certified IDR entity determines this 

information to be credible and that it 

relates to the offer for the payment 

amount for the qualified IDR service 

that is the subject of the payment 

determination. Neither party submits 

any additional information. 

(2) Conclusion. In this paragraph 

(c)(4)(iv)(E) (Example 5), the certified 

IDR entity must consider the qualifying 

payment amount, which is based on the 

downcoded service code. The certified 

IDR entity then must consider whether 

to give weight to additional information 

submitted by the parties. If the certified 

IDR entity determines that the 

additional credible information 

submitted by the provider demonstrates 

that the nonparticipating provider’s 

offer, which is equal to the qualifying 

payment amount for the service code 

that the provider billed, best represents 

the value of the qualified IDR service, 

the certified IDR entity should select the 

nonparticipating provider’s offer. 

(v) Prohibition on consideration of 

certain factors. For further guidance, see 

§ 54.9816–8T(c)(5)(v). 

(vi) Written Decision. For further 

guidance, see § 54.9816–8T(c)(5)(vi). 

(vii) Effects of determination—(A) 

Binding. For further guidance see 

§ 54.9816–8T(c)(5)(vii)(A). 

(B) Suspension of certain subsequent 

IDR requests.—In the case of a 

determination made by a certified IDR 

entity under paragraph (c)(5)(ii) of this 

section, the party that submitted the 

initial notification under paragraph 

(b)(2) of this section may not submit a 

subsequent notification involving the 

same other party with respect to a claim 

for the same item or service that was the 

subject of the initial notification during 

the 90-calendar-day period following 

the determination. 

(C) Subsequent submission of requests 

permitted. If the end of the open 

negotiation period specified in 

paragraph (b)(1) of this section occurs 

during the 90-calendar-day suspension 

period regarding claims for the same 

item or service that were the subject of 

the initial notice of IDR determination 

as described in paragraph (c)(5)(vi) of 

this section, either party may initiate the 

Federal IDR process for those claims by 

submitting a notification as specified in 

paragraph (b)(2) of this section during 

the 30-business-day period beginning on 

the day after the last day of the 90- 

calendar-day suspension period. 

(viii) Recordkeeping requirements. 

For further guidance see § 54.9816– 

8T(c)(5)(viii). 

(ix) Payment. For further guidance see 

§ 54.9816–8T(c)(5)(ix). 

(d) Costs of IDR process—(1) Certified 

IDR entity fee—(i) Timing of payment of 

certified IDR entity fee. Each party to a 

dispute for which there is a final 

selection of the certified IDR entity and 

a determination that the dispute is 

eligible for the Federal IDR process in 

accordance with paragraph (c)(2) of this 

section must pay to the certified IDR 

entity the predetermined certified IDR 

entity fee charged by the certified IDR 


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entity. The certified IDR entity fee must 

be paid no later than the date a party 

submits its offer to the certified IDR 

entity, in accordance with paragraph 

(c)(5)(i) of this section. 

(ii) Failure to timely pay certified IDR 

entity fee. If a party fails to pay the 

certified IDR entity fee as specified in 

paragraph (d)(1)(i) of this section, that 

party’s offer will not be considered 

received. Such party will continue to be 

responsible for payment of the certified 

IDR entity fee. 

(iii) Method of allocation of the 

certified IDR entity fee after a payment 

determination. After making a payment 

determination, the certified IDR entity 

shall retain the certified IDR entity fee 

described under paragraph (d)(1)(i) of 

this section paid by the non-prevailing 

party as defined in paragraph 

(c)(5)(ii)(A)(2) of this section. The 

certified IDR entity must return the fee 

paid by the prevailing party, as defined 

in paragraph (c)(5)(ii)(A)(1) of this 

section, within 30 business days 

following the date of the certified IDR 

entity’s payment determination. In the 

event of a batched dispute in which 

each party prevails in an equal number 

of determinations, the certified IDR 

entity fee will be split evenly between 

the parties. In that case, the certified 

IDR entity must return half the fee paid 

by each party within 30 business days 

following the date of the certified IDR 

entity’s payment determination. 

(iv) Method of allocation of the 

certified IDR entity fee upon agreement 

or withdrawal after an eligibility 

determination. For a dispute for which 

there is a final selection of the certified 

IDR entity and a determination that the 

dispute is eligible for the Federal IDR 

process in accordance with paragraph 

(c)(2) of this section, unless directed 

otherwise by both parties, the certified 

IDR entity is required to return half of 

each party’s certified IDR entity fee 

within 30 business days of the date both 

parties notify the certified IDR entity 

that they have: 

(A) Reached an agreement on an outof-network rate for qualified IDR items 

or services before the certified IDR 

entity has made its payment 

determination, as described in 

paragraph (c)(3)(i) of this section; or 

(B) Withdrawn the dispute before the 

certified IDR entity has made its 

payment determination, as described in 

paragraph (c)(3)(ii) of this section. 

(v) Method of allocation of the 

certified IDR entity fee upon agreement 

or withdrawal before an eligibility 

determination. When the parties reach 

an agreement on an out-of-network rate 

or withdraw a dispute for which there 

is a final selection of the certified IDR 

entity, but for which no eligibility 

determination has yet been made, 

unless directed otherwise by both 

parties, the certified IDR entity is 

required to return each party’s full 

certified IDR entity fee within 30 

business days of the date both parties 

notify the certified IDR entity that they 

have agreed on an out-of-network rate or 

agreed to withdraw the dispute. 

(2) Administrative fee—(i) In general. 

Each party to a dispute for which a 

certified IDR entity is selected under 

paragraph (c)(1) of this section must pay 

a non-refundable administrative fee to 

the Secretary for participating in the 

Federal IDR process. 

(A) Timing of payment of 

administrative fee. The initiating party 

must pay the administrative fee within 

2 business days of the date of 

preliminary selection of the certified 

IDR entity as described in paragraph 

(c)(1)(iii) of this section. The noninitiating party must pay the 

administrative fee within 2 business 

days of the date the non-initiating party 

receives notice that an eligibility 

determination for the Federal IDR 

process has been reached by either the 

certified IDR entity or the Departments 

in accordance with paragraph (c)(2) of 

this section. 

(B) Agreements and withdrawals. In 

the case of an agreement, as described 

in paragraph (c)(3)(i) of this section, or 

a withdrawal, as described in paragraph 

(c)(3)(ii) of this section, the 

administrative fee will not be returned 

to the parties if preliminary selection of 

the certified IDR entity has occurred, as 

described in paragraph (c)(1)(i) of this 

section; if not yet collected, the 

administrative fee must still be paid, 

except as provided in paragraph 

(d)(2)(i)(C) of this section for a dispute 

closed for nonpayment by an initiating 

party. 

(C) Failure to pay administrative fee. 

If the initiating party fails to pay the 

administrative fee in accordance with 

paragraph (d)(2)(i)(A) of this section, the 

dispute will be closed due to 

nonpayment and neither party will be 

responsible for the administrative fee. If 

the non-initiating party fails to pay the 

administrative fee in accordance with 

paragraph (d)(2)(i)(A) of this section, 

that party’s offer will not be considered 

received and the non-initiating party 

will continue to be responsible for 

payment of the administrative fee. 

(D) Collection of unpaid fees. Any 

party that fails to pay the administrative 

fee owed in accordance with paragraph 

(d)(2)(i)(A) of this section is obligated to 

pay the administrative fee otherwise 

due and owing, except as provided in 

paragraph (d)(2)(i)(C) of this section for 

a dispute closed for nonpayment by an 

initiating party. The Secretary will 

pursue collection from a party to a 

dispute of any administrative fee that is 

not timely paid pursuant to applicable 

debt collection authorities. 

(ii) Administrative fee amount. The 

administrative fee amount and method 

of payment will be established through 

notice and comment rulemaking in a 

manner such that the total 

administrative fees paid for a year, 

including administrative fees reduced 

under paragraph (d)(2)(iii) of this 

section, are estimated to be equal to the 

projected amount of expenditures made 

by the Secretaries of the Treasury, 

Labor, and Health and Human Services 

for the year in carrying out the Federal 

IDR process. 

(A) For disputes initiated on or after 

the later of the effective date of Federal 

Independent Dispute Resolution (IDR) 

Process Administrative Fee and 

Certified IDR Entity Fee Ranges final 

rules or January 1, 2024, the 

administrative fee amount is $150 per 

party per dispute, which will remain in 

effect until changed by subsequent 

rulemaking. 

(B) [Reserved] 

(iii) Reducing the administrative fee 

amount. For disputes initiated on or 

after January 1, 2025— 

(A) The Secretary may reduce the 

administrative fee for both parties in 

accordance with paragraph (d)(2)(iii)(C) 

of this section when the highest offer 

made by either party during open 

negotiation for the dispute is less than 

the threshold established through notice 

and comment rulemaking, pursuant to 

paragraph (d)(2)(ii) of this section. For a 

dispute that satisfies the requirements 

for a reduced administrative fee in 

accordance with this paragraph and for 

which a determination has been made 

that the dispute is eligible for the 

Federal IDR process in accordance with 

paragraph (c)(2) of this section, the 

administrative fee amount may be 

reduced to 50 percent of the 

administrative fee amount as described 

in paragraph (d)(2)(ii) of this section for 

each party to the dispute. For a dispute 

that satisfies the requirements for a 

reduced administrative fee in 

accordance with this paragraph and for 

which a determination has been made 

that the dispute is ineligible for the 

Federal IDR process in accordance with 

paragraph (c)(2) of this section, the 

administrative fee amount may be 

reduced to 50 percent of the 

administrative fee amount as described 

in paragraph (d)(2)(ii) of this section for 

the initiating party and to 20 percent of 

the administrative fee amount for the 

non-initiating party. 


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(B) The Secretary may reduce the 

administrative fee for a non-initiating 

party in accordance with paragraph 

(d)(2)(iii)(C) of this section when the 

dispute is determined to be ineligible 

for the Federal IDR process in 

accordance with paragraph (c)(2) of this 

section. For a dispute that satisfies the 

requirements for a reduced 

administrative fee in accordance with 

this paragraph, the administrative fee 

amount for the non-initiating party may 

be reduced to 20 percent of the 

administrative fee amount as described 

in paragraph (d)(2)(ii) of this section. 

(C) The reduced administrative fee 

amounts provided for in paragraphs 

(d)(2)(iii)(A) and (B) of this section shall 

be established in notice and comment 

rulemaking and will remain in effect 

until changed by subsequent 

rulemaking, pursuant to paragraph 

(d)(2)(ii) of this section. 

(e) Certification of IDR entity—(1) In 

general. For further guidance, see 

§ 54.9816–8T(e)(1); 

(2) Requirements. For further 

guidance, see § 54.9816–8T(e)(2) 

introductory text; 

(i) For further guidance, see 

§ 54.9816–8T(e)(2)(i); 

(ii) For further guidance, see 

§ 54.9816–8T(e)(2)(ii); 

(iii) For further guidance, see 

§ 54.9816–8T(e)(2)(iii); 

(iv) For further guidance, see 

§ 54.9816–8T(e)(2)(iv); 

(v) For further guidance, see 

§ 54.9816–8T(e)(2)(v); 

(vi) Meet appropriate indicators of 

fiscal integrity and stability by 

demonstrating that the certified IDR 

entity has a system of safeguards and 

controls in place to prevent and detect 

improper financial activities by its 

employees and agents to assure fiscal 

integrity and accountability for all 

certified IDR entity fees and 

administrative fees (if applicable) 

received, held, and disbursed and by 

submitting 3 years of financial 

statements or, if not available, other 

information to demonstrate fiscal 

stability of the certified IDR entity; 

(vii) For further guidance, see 

§ 54.9816–8T(e)(2)(vii); 

(viii) Have a procedure in place to 

retain the certified IDR entity fees 

described in paragraph (d)(1) of this 

section paid by both parties in a trust or 

escrow account and to return the 

certified IDR entity fee paid by the 

prevailing party or a portion of each 

party’s certified IDR entity fee in the 

case of an agreement described in 

paragraph (c)(3)(i) of this section, a 

withdrawal described in paragraph 

(c)(3)(ii) of this section, or a 

circumstance described under 

paragraph (d)(1)(iii) of this section, 

within 30 business days following the 

date of the determination; 

(ix) Have a procedure in place to 

retain the administrative fees (if 

applicable) described in paragraph 

(d)(2) of this section and to remit the 

administrative fees to the Secretary in 

accordance with the timeframe and 

procedures set forth in guidance 

published by the Secretary; 

(x) For further guidance, see 

§ 54.9816–8T(e)(2)(x); and 

(xi) For further guidance, see 

§ 54.9816–8T(e)(2)(xi); 

(3) Conflict-of-interest standards. For 

further guidance, see § 54.9816–8T(e)(3). 

(4) Period of Certification. For further 

guidance, see § 54.9816–8T(e)(4). 

(5) Petition for denial or revocation. 

For further guidance, see § 54.9816– 

8T(e)(5). 

(6) Denial of IDR entity certification or 

revocation of certified IDR entity 

certification. For further guidance, see 

§ 54.9816–8T(e)(6). 

* * * * * 

(g) Extension of time periods for 

extenuating circumstances—(1) In 

general. The time periods specified in 

this section (other than the time for 

payment, if applicable, under 

§ 54.9816–8T(c)(5)(ix)) may be extended 

in extenuating circumstances at the 

Secretary’s discretion. Extenuating 

circumstances include, but are not 

limited to when: 

(i) With respect to a specific dispute, 

the Secretary determines that the parties 

or certified IDR entity cannot meet 

applicable timeframes due to matters 

beyond the control of one or both 

parties or the certified IDR entity, or for 

other good cause. The certified IDR 

entity or either party may also submit a 

request for an extension due to 

extenuating circumstances to the 

Secretary through the Federal IDR 

portal. The requesting certified IDR 

entity or party must attest that it will 

take prompt action to ensure that the 

certified IDR entity’s payment 

determination under this section may be 

made as soon as administratively 

practicable under the circumstances; or 

(ii) The Secretary determines that the 

parties or certified IDR entity cannot 

meet applicable timeframes due to 

systematic delays in processing disputes 

under the Federal IDR process, such as 

an unforeseen volume of disputes or 

Federal IDR portal system failures. 

Extensions provided due to extenuating 

circumstances caused by an unforeseen 

volume of disputes will be applied to 

the timeframe for eligibility 

determinations under paragraph (c)(2) of 

this section. Extensions provided due to 

extenuating circumstances caused by 

systems failures within the Federal IDR 

portal will be applied to the Federal IDR 

process timeframe(s) determined 

relevant by the Secretary. The Secretary 

will post a public notice regarding any 

extensions of time periods pursuant to 

this paragraph (g)(1)(ii). 

(A) Timeframe following an extension 

to eligibility determination. When an 

extension to the eligibility 

determination timeframe pursuant to 

paragraph (g)(1)(ii) of this section is in 

effect, the start date of the subsequent 

timeframes in the Federal IDR process 

will be determined based on the date of 

completion of the eligibility 

determination by the certified IDR entity 

or the Secretary. 

(1) Submission of offers. The parties 

must submit their offers and certified 

IDR entity fees to the certified IDR entity 

not later than 10 business days after the 

qualified IDR items and services are 

determined eligible as described in 

paragraph (c)(2) of this section. 

(2) Payment Determination. The 

certified IDR entity must make the 

payment determination and notification 

of the payment determination to the 

parties not later than 30 business days 

after the qualified IDR items and 

services are determined eligible as 

described in paragraph (c)(2) of this 

section. 

(B) Timeframe following an extension 

to other timeframes in the Federal IDR 

process. When an extension to any 

timeframe within the Federal IDR 

process, other than the eligibility 

timeframe, is in effect pursuant to 

paragraph (g)(1)(ii) of this section, the 

start date of each subsequent timeframe 

in the Federal IDR process will be 

determined based on the date of 

completion of the process for which the 

extension was granted. 

(2) [Reserved] 

(h) Applicability date. (1) Paragraph 

(a) of § 54.9816–8T is applicable with 

respect to plan years beginning on or 

after January 1, 2022, except that the 

provisions regarding IDR entity 

certification at § 54.9816–8T(a) and (e) 

are applicable beginning on October 7, 

2021, and the revised definition for 

batched qualified IDR items and 

services at paragraph (a)(2)(i) of this 

section is applicable to disputes with 

open negotiation periods beginning on 

or after the later of August 15, 2024, or 

90 days after the effective date of the 

rule. 

(2) Paragraph (b) of this section is 

applicable to disputes with open 

negotiation periods beginning on or 

after the later of August 15, 2024, or 90 

days after the effective date of the rule. 


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(3) Paragraph (c)(1) of this section, 

regarding the selection of a certified IDR 

entity, is applicable to disputes with 

open negotiation periods beginning on 

or after the later of August 15, 2024, or 

90 days after the effective date of the 

rule, except that paragraphs 

(c)(1)(iv)(A)(1) through (3) of this 

section, regarding the conflict-of-interest 

standards, are applicable with respect to 

plan years beginning on or after January 

1, 2022. 

(4) Paragraph (c)(2) of this section, 

regarding the Federal IDR process 

eligibility review and paragraph (c)(3) of 

this section regarding the authority to 

continue negotiations or withdraw, are 

applicable to disputes with open 

negotiation periods beginning on or 

after the later of August 15, 2024, or 90 

days after the effective date of the rule, 

and paragraph (c)(4) of this section 

regarding the treatment of batched and 

bundled qualified IDR items and 

services is applicable 90 days after the 

effective date of the rule. 

(5) Paragraphs (c)(5)(i) and (ii), and 

(c)(5)(vii)(B) and(C) of this section 

regarding the deadlines for the 

submission of offers, payment 

determination and notification, 

suspension of certain subsequent IDR 

requests, and subsequent submission of 

requests submitted are applicable to 

disputes with open negotiation periods 

beginning on or after the later of August 

15, 2024, or 90 days after the effective 

date of the rule. Paragraphs (c)(5)(iii) 

and (vi) of this section regarding 

considerations in payment 

determinations and the related 

examples and paragraph (c)(5)(vi)(B) of 

this section regarding written decisions 

are applicable with respect to items or 

services furnished on or after October 

25, 2022, for plan years beginning on or 

after January 1, 2022. Section 54.9816– 

8T(c)(5)(v) through (c)(5)(vi)(A), 

§ 54.9816–8T(c)(5)(vii)(A), and 

§ 54.9816–8T(c)(5)(viii) and (ix) are 

applicable with respect to plan years 

beginning on or after January 1, 2022. 

(6) Paragraph (d) of this section 

regarding the costs of the IDR process is 

applicable to disputes initiated on or 

after January 1, 2025. 

(7) Section 54.9816–8T(e) is 

applicable with respect to plan years 

beginning on or after January 1, 2022. 

The provisions regarding IDR entity 

certification at paragraphs (1), (e)(2)(i) 

through (vi), (e)(2)(x) and (xi), and (e)(3) 

through (6) of this section are applicable 

beginning on October 7, 2021. 

Paragraphs (e)(2)(vi), (viii), and (ix) of 

this section regarding the certified IDR 

entity’s controls to prevent and detect 

improper financial activities, and 

procedures to retain the certified IDR 

entity fee and administrative fee are 

applicable upon the effective date of the 

rule. 

(8) Section 54.9816–8T(f) is 

applicable with respect to plan years 

beginning on or after January 1, 2022. 

Section 54.9816–8(f)(1)(v)(F) regarding 

reporting of information relating to the 

Federal IDR process is applicable with 

respect to items or services furnished on 

or after October 25, 2022, for plan years 

beginning on or after January 1, 2022. 

(9) Paragraph (g) of this section 

regarding the extension of time periods 

for extenuating circumstances is 

applicable to disputes with open 

negotiation periods beginning on or 

after the later of August 15, 2024, or 90 

days after the effective date of the rule. 

(10) Until the relevant applicability 

date for the requirements of this section, 

plans, issuers, providers, facilities, 

providers of air ambulance services and 

certified IDR entities are required to 

continue to comply with the 

corresponding section of §§ 54.9816–8 

and 54.9816–8T in effect on October 25, 

2022. 

(i) Severability. (1) Any provision of 

this section held to be invalid or 

unenforceable by its terms, or as applied 

to any person or circumstance, shall be 

construed so as to continue to give 

maximum effect to the provision 

permitted by law, unless such holding 

shall be one of utter invalidity or 

unenforceability, in which event the 

provision shall be severable from this 

section and shall not affect the 

remainder thereof or the application of 

the provision to persons not similarly 

situated or to dissimilar circumstances. 

(2) The provisions of paragraphs 

(b)(1), (c)(2)(ii), (c)(4), (d)(2), and (g)(1) 

of this section are intended to be 

severable from one another, from any 

grant of forbearance from removal 

resulting from this subpart, and from 

any provision referenced in those 

paragraphs. The provisions in 

§§ 54.9816–8 and 54.9816–8T are 

intended to be severable from the 

provisions in §§ 54.9816–6A, 54.9816–6, 

54.9816–6T, and 54.9816–9, from any 

grant of forbearance from removal 

resulting from this subpart, and from 

any provision referenced in §§ 54.9816– 

6A, 54.9816–6, 54.9816–6T, and 

54.9816–9. 

■ 10. Section 54.9816–8T is amended 

by: 

■ a. Revising paragraphs (a)(2)(i), (b)(1) 

through (3), (c)(1)(i) and (c)(2); 

■ b. Redesignating paragraphs (c)(3) 

through (c)(4) as (c)(4) through (c)(5); 

■ c. Adding new paragraph (c)(3); 

■ d. Revising newly redesignated 

paragraphs (c)(4)(i) introductory text, 

(c)(4)(i)(B) through (D), (c)(4)(ii), (c)(5(i) 

introductory text, (c)(5)(ii), (iii) and (iv), 

(c)(5)(vi)(B), (c)(5)(vii)(A) introductory 

text, and (c)(5)(vii)(B) and (C); 

■ e. Revising paragraphs (d) 

introductory text, (e)(2)(vi), (viii) and 

(ix), and (g); and 

■ f. Adding paragraphs (h) and (i). 

The revisions and additions read as 

follows: 

§ 54.9816–8T Independent dispute 

resolution process. (temporary) 

(a) * * * 

(2) * * * 

(i) Batched items and services—For 

further guidance, see § 54.9816– 

8(a)(2)(i); 

* * * * * 

(b) * * * 

(1) Determination of payment amount 

through open negotiation. For further 

guidance, see § 54.9816–8(b)(1); 

(2) Initiating the Federal IDR process. 

For further guidance, see § 54.9816– 

8(b)(2); 

(3) Manner. For further guidance, see 

§ 54.9816–8(b)(3). 

(c) * * * 

(1) * * * 

(i) Preliminary selection of the 

certified IDR entity. For further 

guidance, see § 54.9816–8(c)(1). 

* * * * * 

(2) Federal IDR process eligibility 

review. For further guidance, see 

§ 54.9816–8(c)(2). 

(3) Authority to continue negotiations 

or withdraw. For further guidance, see 

§ 54.9816–8(c)(3). 

(4) * * * 

(i) In general. For further guidance, 

see § 54.9816–8(c)(4)(i). 

(A) The qualified IDR items and 

services are billed by the same provider 

or group of providers, the same facility, 

or the same provider of air ambulance 

services. Items and services are billed by 

the same provider or group of providers, 

the same facility, or the same provider 

of air ambulance services if the items or 

services are billed with the same 

National Provider Identifier or Tax 

Identification Number; 

(B) For further guidance, see 

§ 54.9816–8(c)(4)(i)(B). 

(C) For further guidance, see 

§ 54.9816–8(c)(4)(i)(C). 

(D) For further guidance, see 

§ 54.9816–8(c)(4)(i)(D). 

(ii) Treatment of bundled payment 

arrangements. For further guidance, see 

§ 54.9816–8(c)(4)(ii) 

(5) * * * 

(i) Submission of offers. For further 

guidance, see § 54.9816–8(c)(5)(i). 

* * * * * 

(ii) Payment determination and 

notification. For further guidance, see 

§ 54.9816–8(c)(5)(ii). 


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(A) For further guidance, see 

§ 54.9816–8(c)(5)(ii)(A) 

(B) Notify the plan and the provider 

or facility, as applicable, of the selection 

of the offer under paragraph (c)(5)(ii)(A) 

of this section, and provide the written 

decision required under (c)(5)(vi) of this 

section. 

(iii) Considerations in determination. 

For further guidance, see § 54.9816– 

8(c)(5)(iii). 

(iv) Examples. For further guidance, 

see § 54.9816–8(c)(5)(iv). 

* * * * * 

(vi) * * * 

(B) For further guidance, see 

§ 54.9816–8(c)(5)(vi)(B). 

(vii) * * * 

(A) Binding determination made by a 

certified IDR entity under paragraph 

(c)(5)(ii) of this section: 

* * * * * 

(B) Suspension of certain subsequent 

IDR requests. For further guidance, see 

§ 54.9816–8(c)(5)(vii)(B). 

(C) Subsequent submission of requests 

permitted. For further guidance, see 

§ 54.9816–8(c)(5)(vii)(C). 

* * * * * 

(d) Costs of IDR process. For further 

guidance, see § 54.9816–8(d); 

* * * * * 

(e) * * * 

(2) * * * 

(vi) For further guidance, see 

§ 54.9816–8(e)(2)(vi); 

* * * * * 

(viii) For further guidance, see 

§ 54.9816–8(e)(2)(viii); 

(ix) For further guidance, see 

§ 54.9816–8(e)(2)(ix); 

* * * * * 

(g) Extension of time periods for 

extenuating circumstances. For further 

guidance, see § 54.9816–8(g). 

(h) Applicability date. For further 

guidance, see § 54.9816–8(h); 

(i) Severability. For further guidance, 

see § 54.9816–8(i). 

■ 11. Section 54.9816–9 is added to read 

as follows: 

§ 54.9816–9 Federal Independent Dispute 

Resolution Registry of Group Health Plans, 

Health Insurance Issuers, and Federal 

Employees Health Benefits Carriers. 

(a) Establishment of Federal 

independent dispute resolution registry. 

The Secretary, jointly with the Secretary 

of Health and Human Services and the 

Secretary of Labor, will establish a 

Federal IDR registry consisting of the 

information described in paragraph 

(b)(2) of this section and will assign a 

registration number for each group 

health plan, health insurance issuer 

offering group or individual health 

insurance coverage, and Federal 

Employees Health Benefits (FEHB) 

Program carrier. The information 

contained in the registry will be made 

available to parties seeking to initiate an 

open negotiation or a dispute through 

the Federal IDR portal, and will be 

searchable, including by registration 

number. 

(b) Federal IDR registration—(1) 

Registration requirement. Each group 

health plan subject to the Federal IDR 

process must register with the Federal 

IDR registry as specified by the 

Secretary in guidance. Initial 

registration must be completed by the 

later of the date that is 30 business days 

after the effective date of the final rule, 

the date that is 30 business days after 

the registry becomes available, or the 

date the group health plan begins 

offering a group health plan coverage 

subject to the Federal IDR process. 

(2) Required data elements. Group 

health plans subject to the registration 

requirement must include the following 

information with their registration: 

(i) The legal business name (if any) of 

the group health plan, and, if 

applicable, the legal business name of 

the group health plan sponsor; 

(ii) Whether the plan is a self- or fullyinsured group health plan subject to 

ERISA or a self- or fully-insured church 

plan; 

(iii) The State(s) in which the plan is 

subject to a specified State law, as 

defined in § 54.9816–3T for any items or 

services for which the protections of 

§§ 54.9816–1T, 54.9816–4T, and 

54.9816–5T apply; 

(iv) The State(s) in which the plan is 

subject to an All-Payer Model 

Agreement under section 1115A of the 

Social Security Act for any items or 

services to which the protections in 

§§ 54.9816–1T, 54.9816–4T, and 

54.9816–5T, apply; 

(v) For self-insured group health plans 

not otherwise subject to State law, any 

State(s) in which the group health plan 

has properly effectuated an election to 

opt in to a specified State law as defined 

in § 54.9816–3T, if that State allows a 

plan not otherwise subject to the State 

law to opt-in; 

(vi) Contact information, including a 

telephone number and email address, 

for the appropriate person or office with 

whom to initiate open negotiations for 

purposes of determining an amount of 

payment (including cost sharing) for 

such item or service; 

(vii) The 14-digit Health Insurance 

Oversight System (HIOS) identifier; or if 

the 14-digit HIOS identifier has not been 

assigned, the 5-digit HIOS identifier; or 

if no HIOS identifier is available, the 

plan’s or the plan sponsor’s Employer 

Identification Number (EIN) and the 

plan’s plan number (PN), if a PN is 

available; 

(viii) Additional information needed 

to identify the plan and the applicable 

Federal and State requirements for 

determining appropriate out-of-network 

payment rates for items or services to 

which the protections against balance 

billing in this part apply, as specified by 

the Secretary in guidance; and 

(ix) Additional information needed 

for purposes of administrative fee 

collection, as specified by the Secretary 

in guidance. 

(3) Updating disclosures. A plan must 

timely report to the Secretary changes to 

the information required under this 

section within 30 calendar days after the 

information changes. A plan must 

confirm the accuracy of its registration 

annually in the fourth quarter of each 

calendar year. 

(4) Third party authority. The 

requirements of paragraphs (b)(1) 

through (3) of this section may be 

performed by a third party administrator 

or service provider with authority to act 

on behalf of the group health plan 

subject to the Federal IDR process. If the 

registration requirements are performed 

by such third party administrator or 

service provider the group health plan 

or health insurance issuer offering group 

or individual health insurance coverage 

must require that such third party 

administrator or service provider clearly 

delineate each group health plan or 

health insurance issuer offering group 

health insurance coverage for which it 

has authority to act. If such third party 

administrator or service provider fails to 

provide the information in compliance 

with the requirements of paragraphs 

(b)(1) through (3) of this section the plan 

or issuer will be in violation of the 

requirements of this section. 

(c) Severability. (1) Any provision of 

this section held to be invalid or 

unenforceable by its terms, or as applied 

to any person or circumstance, shall be 

construed so as to continue to give 

maximum effect to the provision 

permitted by law, unless such holding 

shall be one of utter invalidity or 

unenforceability, in which event the 

provision shall be severable from this 

section and shall not affect the 

remainder thereof or the application of 

the provision to persons not similarly 

situated or to dissimilar circumstances. 

(2) The provisions in § 54.9816–9 are 

intended to be severable from the 

provisions in §§ 54.9816–6, 54.9816–6T, 

54.9816–8, and 54.9816–8T, from any 

grant of forbearance from removal 

resulting from this subpart, and from 

any provision referenced in §§ 54.9816– 

6, 54.9816–6T, 54.9816–8, and 54.9816– 

8T. 


lotter on DSK11XQN23PROD with PROPOSALS2
75866 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

DEPARTMENT OF LABOR 

EMPLOYEE BENEFITS SECURITY 

ADMINISTRATION 

For the reasons stated in the 

preamble, the Department of Labor 

proposes to amend 29 CFR part 2590 as 

set forth below: 

PART 2590—RULES AND 

REGULATIONS FOR GROUP HEALTH 

PLANS 

■ 12. The authority citation for part 

2590 continues to read as follows: 

Authority: 29 U.S.C. 1027, 1059, 1135, 

1161–1168, 1169, 1181–1183, 1181 note, 

1185, 1185a, 1185b, 1191, 1191a, 1191b, and 

1191c; sec. 101(g), Pub. L. 104–191, 110 Stat. 

1936; sec. 401(b), Pub. L. 105–200, 112 Stat. 

645 (42 U.S.C. 651 note); sec. 512(d), Pub. L. 

110–343, 122 Stat. 3881; sec. 1001, 1201, and 

1562(e), Pub. L. 111–148, 124 Stat. 119, as 

amended by Pub. L. 111–152, 124 Stat. 1029; 

Division M, Pub. L. 113–235, 128 Stat. 2130; 

Secretary of Labor’s Order 1–2011, 77 FR 

1088 (Jan. 9, 2012). 

Subpart D—Surprise Billing and 

Transparency Requirements 

■ 13. Section 2590.716–3 is amended by 

adding the definition of ‘‘Bundled 

payment arrangement’’ in alphabetical 

order to read as follows: 

§ 2590.716–3 Definitions. 

* * * * * 

Bundled payment arrangement means 

an arrangement under which— 

(1) A provider, facility, or provider of 

air ambulance services bills for multiple 

items or services furnished to a single 

patient under a single service code that 

represents multiple items or services 

(for example, a Diagnosis-Related Group 

(DRG) code); or 

(2) A plan or issuer makes an initial 

payment or notice of denial of payment 

to a provider, facility, or provider of air 

ambulance services under a single 

service code that represents multiple 

items or services furnished to a single 

patient (for example, a DRG code). 

* * * * * 

■ 14. Section 2590.716–6 is amended 

by: 

■ a. Revising paragraphs (d) 

introductory text and (d)(1)(iv); 

■ b. Redesignating paragraph (d)(1)(v) as 

paragraph (d)(1)(vi); 

■ c. Adding a new paragraph (d)(1)(v); 

■ d. Revising paragraph (d)(2) 

introductory text; and 

■ e. Adding paragraph (g). 

The revisions and additions read as 

follows: 

§ 2590.716–6 Methodology for calculating 

qualifying payment amount. 

* * * * * 

(d) Information to be shared about the 

qualifying payment amount. In cases in 

which the recognized amount, with 

respect to an item or service furnished 

by a nonparticipating provider or 

nonparticipating emergency facility, is 

the qualifying payment amount or the 

amount billed by the provider or 

facility, or if the amount on which cost 

sharing is based with respect to air 

ambulance services furnished by a 

nonparticipating provider of air 

ambulance services is the qualifying 

payment amount or the amount billed 

by the provider of air ambulance 

services, the plan or issuer must provide 

to the provider, facility, or provider of 

air ambulance services, as applicable, in 

writing, in paper or electronic form— 

(1) * * * 

(iv) A statement that— 

(A) If the provider, facility, or 

provider of air ambulance services, as 

applicable, wishes to initiate a 30- 

business-day open negotiation period 

for purposes of determining the out-ofnetwork rate, the provider, facility, or 

provider of air ambulance services must: 

(1) Contact the appropriate person or 

office to initiate open negotiation within 

30 business days of receiving the initial 

payment or notice of denial of payment, 

and 

(2) For disclosures required to be 

provided on or after [DATE 90 DAYS 

AFTER PUBLICATION OF FINAL 

REGULATIONS IN THE FEDERAL 

REGISTER] and once the open 

negotiation notice can be submitted 

through the Federal IDR portal, notify 

the Secretary as described under 

§ 2590.716–8(b)(1)(i); and 

(B) If the 30-business-day open 

negotiation period does not result in an 

agreement on the amount of payment 

the provider, facility, or provider of air 

ambulance services may generally 

initiate the Federal IDR process within 

4 business days after the end of the open 

negotiation period; 

(v) For disclosures required to be 

provided on or after [date 90 days after 

publication of final regulations in the 

Federal Register], the legal business 

name of the group health plan (if any) 

or issuer, the legal business name of the 

plan sponsor (if applicable), and the 

registration number assigned under 

§ 2590.716–9, if the plan or issuer is 

registered under § 2590.716–9. 

(2) In a timely manner upon the 

request of the provider, facility, or 

provider of air ambulance services: 

* * * * * 

(g) Severability. (1) Any provision of 

this section held to be invalid or 

unenforceable by its terms, or as applied 

to any person or circumstance, shall be 

construed so as to continue to give 

maximum effect to the provision 

permitted by law, unless such holding 

shall be one of utter invalidity or 

unenforceability, in which event the 

provision shall be severable from this 

section and shall not affect the 

remainder thereof or the application of 

the provision to persons not similarly 

situated or to dissimilar circumstances. 

(2) The provisions in § 2590.716–6 are 

intended to be severable from the 

provisions in §§ 2590.716–6A, 

2590.716–8, and 2590.716–9, from any 

grant of forbearance from removal 

resulting from this subpart, and from 

any provision referenced in 

§§ 2590.716–6A, 2590.716–8, and 

2590.716–9. 

■ 15. Section 2590.716–6A is added to 

subpart D to read as follows: 

§ 2590.716–6A Use of Claim Adjustment 

Reason Codes and Remittance Advice 

Remark Codes. 

(a) In general. When providing any 

paper or electronic remittance advice to 

an entity that does not have a 

contractual relationship directly or 

indirectly with a group health plan or a 

health insurance issuer offering group or 

individual health insurance coverage 

with respect to the furnishing of the 

item or service under the plan or 

coverage in response to a claim for 

payment for health care items and 

services furnished by that entity, the 

plan or issuer must use claim 

adjustment reason codes (CARCs) and 

remittance advice remark codes 

(RARCs) (see 45 CFR 162.1602 and 

162.1603) as specified in guidance 

issued by the Secretaries of the 

Treasury, Labor, and Health and Human 

Services, or as required under any 

applicable adopted standards and 

operating rules under 45 CFR part 162, 

to communicate information related to 

whether the claim is or is not subject to 

the provisions of this subpart and 45 

CFR part 149, subpart E. 

(b) Severability. (1) Any provision of 

this section held to be invalid or 

unenforceable by its terms, or as applied 

to any person or circumstance, shall be 

construed so as to continue to give 

maximum effect to the provision 

permitted by law, unless such holding 

shall be one of utter invalidity or 

unenforceability, in which event the 

provision shall be severable from this 

section and shall not affect the 

remainder thereof or the application of 

the provision to persons not similarly 

situated or to dissimilar circumstances. 

(2) The provisions in § 2590.716–6A 

are intended to be severable from the 

provisions in §§ 2590.716–6, 2590.716– 

8, and 2590.716–9, from any grant of 


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forbearance from removal resulting from 

this subpart, and from any provision 

referenced in §§ 2590.716–6, 2590.716– 

8, and 2590.716–9. 

■ 16. Section 2590.716–8 is amended 

by: 

■ a. Revising paragraphs (a)(2)(i), 

(b)(1)(i), and (b)(1)(ii)(A); 

■ b. Removing and reserving paragraph 

(b)(1)(ii)(B); 

■ c. Adding paragraph (b)(1)(iii); 

■ d. Revising paragraph (b)(2)(i); 

■ e. Redesignating paragraph (b)(2)(ii) as 

(b)(2)(i)(A); 

■ f. Adding and reserving paragraph 

(b)(2)(i)(B); 

■ g. Redesignating paragraph (b)(2)(iii) 

as (b)(2)(ii); 

■ h. Revising newly redesignated 

paragraph (b)(2)(ii)(A); 

■ i. Reserving newly redesignated 

paragraph (b)(2)(ii)(B); 

■ j. Removing newly redesignated 

paragraph (b)(2)(ii)(C); 

■ k. Adding paragraphs (b)(2)(iii) and 

(b)(3); 

■ l. Revising paragraph (c)(1); 

■ m. Redesignating paragraphs (c)(2) 

through (4) as paragraphs (c)(3) through 

(5), respectively; 

■ n. Adding a new paragraph (c)(2); 

■ o. Revising newly redesignated 

paragraphs (c)(3), (c)(4)(i) introductory 

text, (c)(4)(i)(B) through (D), (c)(4)(ii), 

(c)(5)(i) introductory text, (c)(5)(ii) 

introductory text, 

■ p. Adding paragraphs (c)(5)(ii)(A)(1) 

and (2) and removing the reference to 

‘‘(c)(4)’’ and adding in its place ‘‘(c)(5)’’ 

in newly redesignated paragraphs 

(c)(5)(ii)(A) introductory text and (B);; 

■ q. Revising paragraphs (c)(5)(vii)(B) 

and (C);; 

■ r. Revising paragraphs (d), (e)(2)(vi), 

(viii), and (ix), (g) and (h); 

■ s. Adding paragraph (i). 

The revisions and additions read as 

follows: 

§ 2590.716–8 Independent dispute 

resolution process. 

(a) * * * 

(2) * * * 

(i) Batched qualified IDR items and 

services means multiple qualified IDR 

items or services that are considered 

jointly as part of one payment 

determination by a certified IDR entity 

for purposes of the Federal IDR process 

in accordance with paragraph (c)(4) of 

this section. 

* * * * * 

(b) * * * 

(1) * * * 

(i) In general. With respect to an item 

or service that meets the requirements of 

paragraph (a)(2)(xi)(A) of this section, 

the provider, facility, or provider of air 

ambulance services, or the group health 

plan or health insurance issuer offering 

group or individual health insurance 

coverage may, during the 30-businessday period beginning on the day the 

provider, facility, or provider of air 

ambulance services receives an initial 

payment or notice of denial of payment 

regarding the item or service, initiate an 

open negotiation period for purposes of 

determining the out-of-network rate for 

such item or service. To initiate the 

open negotiation period, a party must 

submit a written open negotiation notice 

with the content specified in paragraph 

(b)(1)(ii) of this section to the other 

party and to the Secretary in the manner 

specified in paragraph (b)(3) of this 

section. The 30-business-day open 

negotiation period begins on the day on 

which the party first submits the open 

negotiation notice and the remittance 

advice documentation specified in 

paragraph (b)(1)(ii)(A)(12) of this section 

to the other party and the Secretary. The 

party in receipt of the open negotiation 

notice must provide to the other party 

and to the Secretary in the manner 

specified in paragraph (b)(3) of this 

section as soon as practicable, but no 

later than the 15th business day of the 

30-business-day open negotiation 

period, a written notice and supporting 

documentation in response to the open 

negotiation notice, as specified in 

paragraph (b)(1)(iii)(A) of this section. 

(ii) * * * 

(A) Content. The open negotiation 

notice must include, with respect to the 

item or service that is the subject of the 

open negotiation notice, information 

about the item or service and the parties 

including: 

(1) Information sufficient to identify 

the provider, facility, or provider of air 

ambulance services, including the name 

and current contact information 

(including the legal business name, 

email address, phone number, and 

mailing address) as provided with the 

claim form submitted by the provider, 

facility, or air ambulance provider to the 

plan or issuer, and the National 

Provider Identifier (NPI); 

(2) Information sufficient to identify 

the plan or issuer, including the plan’s 

or issuer’s registration number, as 

required under § 2590.716–9, if the plan 

or issuer is registered under § 2590.716– 

9, or an attestation from the party 

submitting the open negotiation notice 

that the plan or issuer was not registered 

prior to the date it submitted the notice; 

the legal business name of the plan or 

issuer, as well as the current contact 

information (name, email address, 

phone number, and mailing address) of 

the plan or issuer as provided with the 

initial payment or notice of denial of 

payment; and if the party submitting the 

open negotiation notice is a plan or 

issuer, the plan type (for example, selfinsured or fully-insured); 

(3) The name and contact information 

(including the legal business name, 

email address, phone number, and 

mailing address) for any third party 

representing the party submitting the 

open negotiation notice, and an 

attestation that the third party has the 

authority to act on behalf of the party it 

represents in the open negotiation; 

(4) Information sufficient to identify 

the item or service, including: the 

date(s) the item or service was furnished 

and, if the party submitting the open 

negotiation notice is a provider, facility, 

or provider of air ambulance services, 

the date(s) that the provider, facility, or 

provider of air ambulance services 

received the initial payment or notice of 

denial of payment for the item or service 

from the plan or issuer; the type of item 

or service (specifically, whether the 

item or service is an emergency service 

as defined in § 2590.716–4(c)(2)(i) or 

(ii), a non-emergency service as 

described in § 2590.716–5(b), or an air 

ambulance service as defined in 

§ 2590.716–3); whether the service is a 

professional service or facility-based 

service; the State where the item or 

service was furnished; the claim 

number; the service code; and 

information to identify the location 

where the item or service was furnished 

(such as, place of service code or bill 

type code); 

(5) The initial payment amount 

(including $0 if, for example, payment 

is denied); 

(6) The qualifying payment amount, if 

provided with the initial payment or 

notice of denial of payment or if the 

party submitting the open negotiation 

notice is a plan or issuer; 

(7) An offer of an out-of-network rate 

for each item or service; 

(8) If the party submitting the open 

negotiation notice is a plan or issuer, the 

amount of cost sharing imposed for the 

item or service, if any; 

(9) If the party submitting the open 

negotiation notice is a provider or 

facility, a statement that the items and 

services do not qualify for the notice 

and consent exception described at 45 

CFR 149.410(b) or 149.420(c) through 

(i); 

(10) A statement that the provider, 

facility, or provider of air ambulance 

services was a nonparticipating 

provider, nonparticipating emergency 

facility, or nonparticipating provider of 

air ambulance services on the date the 

item or service was furnished; 

(11) General information listed in the 

standard open negotiation notice 

developed by the Secretary pursuant to 


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paragraph (b)(3) of this section 

describing the open negotiation period 

and the Federal IDR process (including 

a description of the purpose of the open 

negotiation period and Federal IDR 

process and key deadlines in the open 

negotiation period and Federal IDR 

process); and 

(12) A copy of the initial payment or 

notice of denial of payment or other 

remittance advice that is required to 

include the disclosures under 

§ 2590.716–6(d)(1), with respect to the 

item or service. 

(B) [Reserved] 

(iii) Open negotiation response notice. 

(A) Content. The response to the open 

negotiation notice must include, with 

respect to the item or service that is the 

subject of the open negotiation response 

notice, information about the item or 

service and the parties including: 

(1) Information sufficient to identify 

the provider, facility, or provider of air 

ambulance services, including the name 

and current contact information 

(including the legal business name, 

email address, phone number, and 

mailing address) as provided with the 

claim form submitted by the provider, 

facility, or provider of air ambulance 

services to the plan or issuer, and the 

NPI; 

(2) Information sufficient to identify 

the plan or issuer, including the plan’s 

or issuer’s registration number, as 

required under § 2590.716–9 if the plan 

or issuer is registered under § 2590.716– 

9, or an attestation from the party 

submitting the open negotiation 

response notice that the plan or issuer 

was not registered prior to the date it 

submitted the notice; the legal business 

name of the plan or issuer, as well as the 

current contact information (name, 

email address, phone number, and 

mailing address) of the plan or issuer as 

provided with the initial payment or 

notice of denial of payment; and if the 

party submitting the open negotiation 

response notice is a plan or issuer, the 

plan type (for example, self-insured or 

fully-insured); 

(3) The name and contact information 

(including the legal business name, 

email address, phone number, and 

mailing address) for any third party 

representing the party submitting the 

open negotiation response notice, and 

an attestation that the third party has 

the authority to act on behalf of the 

party it represents in the open 

negotiation; 

(4) Information sufficient to identify 

the item or service included in the open 

negotiation notice, including the date(s) 

the item or service was furnished, and 

if the party submitting the open 

negotiation response notice is a 

provider, facility, or provider of air 

ambulance services, the date(s) that the 

provider, facility, or provider of air 

ambulance services received the initial 

payment or notice of denial of payment 

for such item or service from the plan 

or issuer, and the claim number; 

(5) If the party submitting the open 

negotiation response notice is a plan or 

issuer, a statement as to whether it 

agrees that the initial payment amount 

(including $0 if, for example, payment 

is denied) and the qualifying payment 

amount reflected in the open 

negotiation notice accurately reflects the 

initial payment amount and qualifying 

payment amount disclosed with the 

initial payment for the item or service, 

and if not, or if the open negotiation 

notice indicates that qualifying payment 

amount was not communicated by the 

plan or issuer with the initial payment 

or notice of denial of payment or other 

remittance advice, the initial payment 

amount (including $0 if, for example, 

payment is denied) and/or qualifying 

payment amount it believes to be 

correct, and documentation to support 

the statement (for example, the 

remittance advice confirming the 

qualifying payment amount); 

(6) If the party submitting the open 

negotiation response notice is a plan or 

issuer, the amount of cost sharing 

imposed for the item or service, if any; 

(7) A counteroffer for an out-ofnetwork rate for each item or service or 

an acceptance of the other party’s offer; 

(8) If the party submitting the open 

negotiation response notice is a provider 

or facility, a statement that the items 

and services do not qualify for the 

notice and consent exception described 

at 45 CFR 149.410(b) or 149.420(c) 

through (i); 

(9) With respect to each item or 

service, either a statement and 

supporting documentation that explains 

why the item or service is not subject to 

the Federal IDR process or a statement 

agreeing that the item or service is 

subject to the Federal IDR process; 

(10) A statement as to whether any of 

the information provided in the open 

negotiation notice is inaccurate and the 

basis for the statement, as well as 

supporting documentation; and 

(11) A statement confirming that the 

initial payment or notice of denial of 

payment or other remittance advice 

provided by the party submitting the 

open negotiation notice under 

paragraph (b)(1)(ii)(A)(12) of this section 

is accurate, and if inaccurate, a copy of 

the accurate initial payment, or notice of 

denial of payment, or other remittance 

advice required to include the 

disclosures under § 2590.716–6(d)(1), 

with respect to the item or service. 

(B) [Reserved] 

(2) * * * 

(i) In general. Either party may initiate 

the Federal IDR process with respect to 

a qualified IDR item or service for which 

the parties do not agree upon an out-ofnetwork rate by the last day of the open 

negotiation period provided for under 

paragraph (b)(1) of this section. To 

initiate the Federal IDR process, a party 

(the initiating party) must submit a 

written notice of IDR initiation, 

consistent with paragraph (b)(2)(ii) of 

this section, to the other party to the 

dispute (the non-initiating party), and to 

the Secretary in the manner specified in 

paragraph (b)(3) of this section, during 

the 4-business-day period beginning on 

the first business day after the last day 

of the open negotiation period (unless it 

is otherwise required to be submitted in 

the timeframe specified in paragraph 

(c)(5)(vii)(C) of this section). The date of 

IDR initiation is the date that the 

Secretary receives the notice of IDR 

initiation described in paragraph 

(b)(2)(ii) of this section. 

* * * * * 

(B) [Reserved] 

(ii) * * * 

(A) Content. The notice of IDR 

initiation must include, with respect to 

the item or service that is the subject of 

the notice, information about the item or 

service and the parties including: 

(1) Information sufficient to identify 

the provider, facility, or provider of air 

ambulance services, including the name 

and current contact information 

(including the legal business name, 

email address, phone number, and 

mailing address), and the NPI; and if the 

initiating party is a provider, facility, or 

provider of air ambulance services, the 

Tax Identification Number (TIN); 

(2) Information sufficient to identify 

the plan or issuer, including the plan’s 

or issuer’s registration number, as 

required under § 2590.716–9 if the plan 

or issuer is registered under § 2590.716– 

9, or an attestation from the initiating 

party that the plan or issuer was not 

registered prior to the date that it 

submitted the notice; the legal business 

name of the plan or issuer, as well as the 

current contact information (name, 

email address, phone number, and 

mailing address) of the plan or issuer as 

provided with the initial payment or 

notice of denial of payment; and if the 

initiating party is a plan or issuer, the 

plan type (for example, self-insured or 

fully-insured) and TIN (or, in the case 

of a plan that does not have a TIN, the 

TIN of the plan sponsor); 

(3) The name and contact information 

(including the legal business name, 

email address, phone number, and 


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mailing address) for any third party 

representing the initiating party, and an 

attestation that the third party has the 

authority to act on behalf of the party it 

represents in the Federal IDR process; 

(4) Information sufficient to identify 

whether the dispute being initiated 

includes batched or bundled qualified 

IDR items or services as described in 

paragraph (c)(4) of this section; 

(5) Information sufficient to identify 

the qualified IDR item or service that is 

the subject of the notice of IDR 

initiation, including the date(s) the 

qualified IDR item or service was 

furnished; if the initiating party is a 

provider, facility, or provider of air 

ambulance services, the date(s) that the 

provider, facility, or provider of air 

ambulance services received the initial 

payment or notice of denial of payment 

for such item or service from the plan 

or issuer; the date the open negotiation 

period under paragraph (b)(1) of this 

section began; the type of item or 

service (specifically, whether the 

qualified IDR item or service is an 

emergency service as defined in 

§ 2590.716–4(c)(2)(i) or (ii), a nonemergency service as described in 

§ 2590.716–5(b), or an air ambulance 

service as defined in § 2590.716–3); 

whether the service is a professional 

service or facility-based service; the 

State where the item or service was 

furnished; the claim number; the service 

code; and information to identify the 

location the item or service was 

furnished (including place of service 

code or bill type code); 

(6) The initial payment amount 

(including $0 if, for example, payment 

is denied); 

(7) The qualifying payment amount, if 

provided with the initial payment or 

notice of denial of payment or if the 

initiating party is a plan or issuer; 

(8) If the initiating party is a provider 

or facility, a statement that the items 

and services do not qualify for the 

notice and consent exception described 

at 45 CFR 149.410(b) or 149.420(c) 

through (i); 

(9) A statement that the provider, 

facility, or provider of air ambulance 

services was a nonparticipating 

provider, nonparticipating emergency 

facility, or nonparticipating provider of 

air ambulance services on the date the 

item or service was furnished; 

(10) Attestation that the item or 

service under dispute is a qualified IDR 

item or service, and the basis for the 

attestation; 

(11) General information listed in the 

standard notice of IDR initiation 

developed by the Secretary pursuant to 

paragraph (b)(3) of this section 

describing the Federal IDR process 

(including a description of the purpose 

of the Federal IDR process and key 

deadlines in the Federal IDR process); 

(12) A copy of the initial payment or 

notice of denial of payment or other 

remittance advice that is required to 

include the disclosures under 

§ 2590.716–6(d)(1), with respect to the 

item or service; 

(13) Preferred certified IDR entity; and 

(14) A statement describing the key 

aspects of the claim, such as patient 

acuity or level of training of the 

provider, facility, or provider of air 

ambulance services that furnished the 

qualified IDR item or service, discussed 

by the parties during open negotiation 

that relate to the payment for the 

disputed claim, whether the reasons for 

initiating the Federal IDR process are 

different from the aspects of the claim 

discussed during the open negotiation 

period, and an explanation of why the 

party is initiating the Federal IDR 

process, including any of the 

permissible considerations described in 

§§ 2590.716–8(c)(5)(iii) and 2590.717– 

2(b)(2) that serve as the party’s basis for 

initiating the Federal IDR process. 

(B) [Reserved] 

(iii) Notice of IDR initiation response. 

The non-initiating party must provide to 

the initiating party and to the Secretary 

in the manner specified in paragraph 

(b)(3) of this section within 3 business 

days after the date of IDR initiation, a 

written notice and supporting 

documentation in response to the notice 

of IDR initiation, as specified in 

paragraph (b)(2)(iii)(A) of this section. 

(A) Content. The notice of IDR 

initiation response must include, with 

respect to the item or service that is the 

subject of the notice, information about 

the item or service and the parties 

including: 

(1) Information sufficient to identify 

the provider, facility, or provider of air 

ambulance services, including the name 

and current contact information 

(including the legal business name, 

email address, phone number, and 

mailing address), and the NPI; and if the 

non-initiating party is a provider, 

facility, or provider of air ambulance 

services, the TIN; 

(2) Information sufficient to identify 

the plan or issuer, including the plan’s 

or issuer’s registration number, as 

required under § 2590.716–9 if the plan 

or issuer is registered under § 2590.716– 

9 or an attestation from the noninitiating party that the plan or issuer 

was not registered prior to the date that 

it submitted the notice; the legal 

business name of the plan or issuer, as 

well as the current contact information 

(name, email address, phone number, 

and mailing address) of the plan or 

issuer as provided with the initial 

payment or notice of denial of payment; 

and if the non-initiating party is a plan 

or issuer, the plan type (for example, 

self-insured or fully-insured) and TIN 

(or, in the case of a plan that does not 

have a TIN, the TIN of the plan 

sponsor); 

(3) The name and contact information 

(including the legal business name, 

email address, phone number, and 

mailing address) for any third party 

representing the non-initiating party, 

and an attestation that the third party 

has the authority to act on behalf of the 

party it represents in the Federal IDR 

process; 

(4) Information sufficient to identify 

each item or service included in the 

notice of IDR initiation, including the 

date(s) the item or service was 

furnished. If the non-initiating party is 

a provider, facility, or provider of air 

ambulance services, the date(s) that the 

provider, facility, or provider of air 

ambulance services received the initial 

payment or notice of denial of payment 

for such item or service from the plan 

or issuer, and the claim number; 

(5) If the non-initiating party is a plan 

or issuer, a statement as to whether the 

non-initiating party agrees that the 

initial payment (including $0 if, for 

example, payment is denied) and the 

qualifying payment amount reflected in 

the notice of IDR initiation is accurate 

for the item or service that is the subject 

of the dispute, and if not, the initial 

payment amount (including $0 if, for 

example, payment is denied) and/or 

qualifying payment amount it believes 

to be correct, and documentation to 

support the statement (for example, the 

remittance advice confirming the 

qualifying payment amount); 

(6) If the non-initiating party is a plan 

or issuer, the amount of cost sharing 

imposed for the item or service, if any; 

(7) If the non-initiating party is a 

provider or facility, a statement that the 

items and services do not qualify for the 

notice and consent exception described 

at 45 CFR 149.410(b) or 149.420(c) 

through (i); 

(8) With respect to each item or 

service that is the subject of the dispute, 

either an attestation that the item or 

service is a qualified IDR item or 

service, or for each item or service that 

the non-initiating party asserts is not a 

qualified IDR item or service, an 

explanation and documentation to 

support the statement; 

(9) A statement confirming that the 

initial payment or notice of denial of 

payment or other remittance advice 

provided by the initiating party under 

paragraph (b)(2)(ii)(A)(12) of this section 

is accurate, and if inaccurate, a copy of 


lotter on DSK11XQN23PROD with PROPOSALS2
75870 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

the accurate initial payment or notice of 

denial of payment or other remittance 

advice required to include the 

disclosures under § 2590.716–6(d)(1), 

with respect to the item or service; 

(10) A statement as to whether any of 

the information provided in the notice 

of IDR initiation is inaccurate and the 

basis for the statement as well as any 

supporting documentation; and 

(11) A statement as to whether the 

non-initiating party agrees or objects to 

the initiating party’s preferred certified 

IDR entity. If the non-initiating party 

objects to the initiating party’s preferred 

certified IDR entity, the notice of IDR 

initiation response must include the 

name of an alternative preferred 

certified IDR entity and, if applicable, 

an explanation of any conflict of interest 

with the initiating party’s preferred 

certified IDR entity. 

(B) [Reserved]. 

(3) Manner. A party furnishing notices 

as required under paragraphs (b)(1)(ii) 

and (iii), and (b)(2)(ii) and (iii) of this 

section must furnish the notices using 

the standard forms developed by the 

Secretary and must furnish the notices 

and supporting documentation to the 

other party and the Secretary, through 

the Federal IDR portal. 

(c) * * * 

(1) Selection of certified IDR entity— 

(i) Preliminary selection of the certified 

IDR entity. Within 3 business days after 

the date of IDR initiation, the noninitiating party must agree or object to 

the preferred certified IDR entity 

identified in the notice of IDR initiation, 

as described in paragraph 

(b)(2)(iii)(A)(11) of this section. 

(A) If the non-initiating party agrees, 

or fails to object, to the selection of the 

initiating party’s preferred certified IDR 

entity in the manner described in 

paragraph (b)(2)(iii)(A)(11) of this 

section and within the timeframe 

specified in paragraph (c)(1)(i) of this 

section, the initiating party’s preferred 

certified IDR entity will be considered 

jointly selected on the third business 

day after the date of IDR initiation. 

(B) If the non-initiating party objects 

to the selection of the initiating party’s 

preferred certified IDR entity by 

designating an alternative preferred 

certified IDR entity in the manner 

described in paragraph (b)(2)(iii)(A)(11) 

of this section and within the timeframe 

specified in paragraph (c)(1)(i) of this 

section, the initiating party may then 

agree or object to the non-initiating 

party’s alternative preferred certified 

IDR entity by submitting the notice of 

certified IDR entity selection in the 

manner specified in paragraph 

(c)(1)(i)(D) of this section. If the 

initiating party agrees to the noninitiating party’s alternative preferred 

certified IDR entity within 3 business 

days after the date of IDR initiation, or 

if the non-initiating party submits the 

notice of IDR initiation response on or 

before the second business day after the 

date of IDR initiation and the initiating 

party fails to respond within 3 business 

days after the date of IDR initiation, the 

alternative preferred certified IDR entity 

will be considered jointly selected by 

the parties. If the non-initiating party 

submits the notice of IDR initiation 

response on the third business day after 

the date of IDR initiation and the 

initiating party does not agree on the 

same day, selection will proceed under 

paragraph (c)(1)(i)(C) of this section. 

(C) If a certified IDR entity is not 

jointly selected under paragraph 

(c)(1)(i)(A) or (B) of this section, either 

party may select an alternative preferred 

certified IDR entity by submitting the 

notice of certified IDR entity selection in 

the manner specified in paragraph 

(c)(1)(i)(D) of this section, until the 

earlier of the date that the parties agree 

on the alternative preferred certified IDR 

entity or the deadline for joint selection, 

which is 3 business days after the date 

of IDR initiation. Once a party submits 

a notice of certified IDR entity selection, 

it may not submit another notice of 

certified IDR entity selection until after 

it receives a responding notice of 

certified IDR entity selection from the 

other party. 

(1) If a party submits a notice of 

certified IDR entity selection to the 

other party on the first or second day 

after the date of IDR initiation and the 

party in receipt of the notice agrees or 

fails to object to the alternative preferred 

certified IDR entity by the third business 

day after the date of IDR initiation, the 

alternative preferred certified IDR entity 

will be considered jointly selected by 

the parties. 

(2) If a party submits a notice of 

certified IDR entity selection to the 

other party on the third business day 

after the date of IDR initiation and the 

party last in receipt of the notice agrees 

to the alternative preferred certified IDR 

entity on the same day, the alternative 

preferred certified IDR entity will be 

considered jointly selected by the 

parties. 

(3) If a party submits a notice of 

certified IDR entity selection to the 

other party on the third business day 

after the date of IDR initiation and the 

party last in receipt of the notice does 

not agree to the alternative preferred 

certified IDR entity on the same day, the 

parties will have failed to jointly select 

a certified IDR entity. 

(D) To notify the other party and the 

Secretary of an agreement or objection 

to an alternative preferred certified IDR 

entity under paragraph (c)(1)(i)(C) of 

this section, a party must submit the 

notice of certified IDR entity selection. 

The party must furnish the notice of 

certified IDR entity selection using the 

standard form developed by the 

Secretary and must furnish the notice to 

the other party and the Secretary 

through the Federal IDR portal within 3 

business days after the date of IDR 

initiation. However, in the event the 

conditions under paragraph (c)(1)(ii) of 

this section apply, the party may notify 

the Secretary of an agreement or 

objection to an alternative preferred 

certified IDR entity in accordance with 

paragraph (c)(1)(ii) of this section. The 

notice of certified IDR entity selection 

must include a statement indicating the 

party’s agreement with or objection to 

the other party’s alternative preferred 

certified IDR entity and, if applicable, 

an explanation of any conflict of interest 

with the alternative preferred certified 

IDR entity. If the party in receipt of a 

notice of certified IDR entity selection 

objects to the other party’s alternative 

preferred certified IDR entity and the 

party submits a notice of certified IDR 

entity selection by the end of the third 

business day after the date of IDR 

initiation, that party’s notice of certified 

IDR entity selection reflecting the 

objection must include the name of 

another alternative preferred certified 

IDR entity. 

(ii) Failure to jointly select a certified 

IDR entity. If the parties fail to jointly 

select a certified IDR entity within 3 

business days after the date of IDR 

initiation, the Secretary will select a 

certified IDR entity. The parties will 

have failed to jointly select a certified 

IDR entity if, by the end of the third 

business day after the date of IDR 

initiation, the party last in receipt of the 

notice of IDR initiation response or the 

notice of certified IDR entity selection 

has objected to the other party’s 

alternative preferred certified IDR 

entity, or if the notice of IDR initiation 

response or the notice of certified IDR 

entity selection is submitted to the other 

party on the third business day after the 

date of IDR initiation and the party in 

receipt of the notice does not agree to 

the alternative preferred certified IDR 

entity within 3 business days after the 

date of IDR initiation. 

(A) In selecting the certified IDR 

entity, the Secretary will first confirm 

whether a party submitted the notice of 

IDR initiation response or the notice of 

certified IDR entity selection with an 

alternative preferred certified IDR entity 

on the third business day after the date 

of IDR initiation without the other 

party’s agreement to the selection. If 


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either notice was provided on the third 

business day after the date of IDR 

initiation without the other party’s 

agreement to the alternative preferred 

certified IDR entity by the end of third 

business day after the date of IDR 

initiation, the Secretary will provide the 

party last in receipt of the applicable 

notice 2 additional business days to 

agree or object to the other party’s 

alternative preferred certified IDR entity 

selection. 

(1) If the party last in receipt of the 

notice of IDR initiation response or the 

notice of certified IDR entity selection 

agrees with the other party’s alternative 

preferred certified IDR entity and 

notifies the Secretary of the agreement 

or fails to notify the Secretary of its 

objection in the Federal IDR portal by 

the fifth business day after the date of 

IDR initiation, the Secretary will select 

the final alternative preferred certified 

IDR entity selected in the applicable 

notice. In disputes where the applicable 

notice was submitted on the third 

business day after the date of IDR 

initiation, the party last in receipt of the 

notice will not be allowed to select 

another alternative preferred certified 

IDR entity. 

(2) If the party notifies the Secretary 

of its objection to the alternative 

preferred certified IDR entity by the fifth 

business day after the date of IDR 

initiation, the Secretary will proceed 

with the random selection of the 

certified IDR entity from among the 

certified IDR entities (other than the 

preferred certified IDR entity and any 

alternative preferred certified IDR entity 

previously selected in such dispute by 

a party, unless there is no other certified 

IDR entity available to select) that 

charge a fee within the allowed range of 

certified IDR entity fees on the sixth 

business day after the date of IDR 

initiation. If there are insufficient 

certified IDR entities that charge a fee 

within the allowed range of certified 

IDR entity fees available to arbitrate the 

dispute, the Secretary will select a 

certified IDR entity that has received 

approval, as described in paragraph 

(e)(2)(vii)(B) of this section, to charge a 

fee outside of the allowed range of 

certified IDR entity fees. In either case, 

the Secretary will notify the parties of 

the preliminary selection of the certified 

IDR entity not later than 6 business days 

after the date of IDR initiation. 

(B) [Reserved]. 

(iii) Date of preliminary selection of 

the certified IDR entity. The date of 

preliminary selection of the certified 

IDR entity will be: 

(A) Three business days after the date 

of IDR initiation if the parties jointly 

selected a certified IDR entity, as 

specified in paragraph (c)(1)(i) of this 

section; or 

(B) Six business days after the date of 

IDR initiation, if the parties fail to 

jointly select a certified IDR entity as 

specified in paragraph (c)(1)(ii) of this 

section. 

(iv) Final selection of the certified IDR 

entity—(A) Conflict-of-interest review. 

The certified IDR entity preliminarily 

selected for a dispute must review the 

selection. The selection of the certified 

IDR entity will be finalized only if the 

certified IDR entity attests to the 

Secretary that it meets the following 

requirements: 

(1) The certified IDR entity does not 

have a conflict of interest as defined in 

paragraph (a)(2)(iv) of this section; 

(2) The certified IDR entity will only 

assign personnel to a dispute and make 

decisions regarding hiring, 

compensation, termination, promotion, 

or other similar matters related to 

personnel assigned to the dispute in a 

manner that is not based upon the 

likelihood that the assigned personnel 

will support a particular party to the 

dispute; and 

(3) The certified IDR entity will not 

assign any personnel to a dispute who 

would have any conflicts of interest, as 

defined in paragraph (a)(2)(iv) of this 

section, regarding any party to the 

dispute or whose relationship with a 

party within the 1 year immediately 

preceding the assignment to the dispute 

would violate the restrictions on aiding 

or advising a former employer or 

principal in a manner similar to the 

restrictions set forth in 18 U.S.C. 207(b). 

(B) Failure to meet conflict-of-interest 

requirements. If the certified IDR entity 

notifies the Secretary within 3 business 

days of the date of preliminary selection 

of the certified IDR entity that it does 

not meet the requirements of paragraphs 

(c)(1)(iv)(A)(1) through (3) of this 

section or if the certified IDR entity does 

not respond within 3 business days after 

the date of preliminary selection of the 

certified IDR entity, the Secretary will 

randomly select another certified IDR 

entity consistent with paragraph 

(c)(1)(ii) of this section. The Secretary 

will notify the parties of the new 

randomly preliminarily selected 

certified IDR entity no later than 1 

business day after the previously 

selected certified IDR entity notifies the 

Secretary that it has a conflict of interest 

or, if the previously selected certified 

IDR entity fails to respond within 3 

business days after the date of 

preliminary selection of the certified 

IDR entity, no later than 1 business day 

after the end of the 3-business-day 

period. 

(C) Date of final selection of the 

certified IDR entity. If the certified IDR 

entity that has been preliminarily 

selected attests within 3 business days 

that it meets the requirements of 

paragraphs (c)(1)(iv)(A)(1) through (3) of 

this section, the Secretary will notify the 

parties of final selection of the certified 

IDR entity no later than 1 business day 

after the certified IDR entity attests that 

it meets the conflict-of-interest 

requirements. The date of final selection 

of the certified IDR entity is the date 

that the Secretary provides this notice to 

the parties. 

(2) Federal IDR process eligibility 

review—(i) Federal IDR process 

eligibility determination by certified IDR 

entity. Unless the departmental 

eligibility review described in paragraph 

(c)(2)(ii) of this section applies, the 

selected certified IDR entity must 

review the information in the notice of 

IDR initiation, notice of IDR initiation 

response, and any additional 

information described in paragraph 

(c)(2)(iii) of this section, and make a 

final determination as to whether the 

item or service is a qualified IDR item 

or service, as defined in paragraph 

(a)(2)(xi) of this section, that is eligible 

for the Federal IDR process. The 

certified IDR entity must make such a 

determination and notify the Secretary 

and both parties no later than 5 business 

days after the date of final selection of 

the certified IDR entity. If the certified 

IDR entity determines that the item or 

service is not a qualified IDR item or 

service, the dispute will be closed, and 

the selected certified IDR entity will not 

take any action with regard to the 

dispute. 

(ii) Departmental eligibility review for 

Federal IDR process eligibility 

determinations. When the conditions for 

the departmental eligibility review set 

forth in paragraph (c)(2)(ii)(A) of this 

section are met, the Secretary will 

conduct the eligibility review and make 

the eligibility determination instead of 

the certified IDR entity. If the Secretary 

determines that the item or service is 

not a qualified IDR item or service, the 

dispute will be closed, and the selected 

certified IDR entity will not take any 

action with regard to the dispute. If the 

dispute is found to be eligible, the 

Secretary will inform the preliminarily 

selected certified IDR entity of the 

dispute’s eligibility so that it may 

conduct its conflict-of-interest 

assessment, and the dispute will 

otherwise continue through the Federal 

IDR process, including notification of 

the eligibility determination to the 

disputing parties by the preliminarily 

selected certified IDR entity. 


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(A) Application of the departmental 

eligibility review. The departmental 

eligibility review will apply when the 

Secretary determines that any of the 

extenuating circumstances described in 

paragraph (g)(1) of this section require 

application of the departmental 

eligibility review to facilitate timely 

payment determinations or the effective 

processing of disputes under the Federal 

IDR process. 

(B) Notification regarding 

applicability of the departmental 

eligibility review. Before invoking the 

application of the departmental 

eligibility review, the Secretary will 

post advance public notification of the 

date on which the departmental 

eligibility review will take effect and the 

reasons for invoking the application of 

the departmental eligibility review. 

Before ending the application of the 

departmental eligibility review, the 

Secretary will post advance public 

notification of the date on which the 

departmental eligibility review will no 

longer be in effect and the reasons for 

ending the application of the 

departmental eligibility review. 

(iii) Request for additional 

information. The Secretary or the 

selected certified IDR entity may request 

additional information from either party 

to a dispute at any time, including for 

the purpose of assessing whether a 

conflict of interest exists, conducting an 

eligibility determination, or making a 

payment determination. 

(A) Upon request, a party must submit 

the additional information within 5 

business days to the Secretary or the 

selected certified IDR entity, as 

applicable, through the Federal IDR 

portal. Following a request for 

additional information, the time period 

for the applicable stage of the Federal 

IDR process will be tolled until the 

earlier of the date either all of the 

requested information is provided or the 

5-business-day period expires, and each 

subsequent timeframe in the Federal 

IDR process will be determined based 

on the date of completion of the stage 

of the Federal IDR process that was 

tolled for provision of the requested 

information. 

(B) If a party fails to submit the 

additional information as required, the 

related determination, including the 

eligibility determination, conflict-ofinterest review, or payment 

determination will be made without the 

requested information unless a goodcause extension of the 5-business-day 

period, as specified in paragraph 

(g)(1)(i) of this section, has been 

provided, and the party subsequently 

submits the additional information 

requested within the extended period. 

(3) Authority to continue negotiations 

or withdraw—(i) Authority to continue 

to negotiate. If the parties to the Federal 

IDR process agree on an out-of-network 

rate for a qualified IDR item or service 

after providing the notice of IDR 

initiation to the Secretary required 

under paragraph (b)(2)(ii) of this section, 

but before the certified IDR entity has 

made its payment determination, the 

amount agreed to by the parties for the 

qualified IDR item or service will be 

treated as the out-of-network rate for the 

qualified IDR item or service. To the 

extent the amount exceeds the initial 

payment amount and any cost sharing 

paid or required to be paid by the 

participant or beneficiary, or there was 

an initial denial of payment, payment 

must be made directly by the plan or 

issuer to the nonparticipating provider, 

nonparticipating facility, or 

nonparticipating provider of air 

ambulance services not later than 30 

business days after the agreement is 

reached. In no instance may either party 

seek additional payment from the 

participant or beneficiary, including in 

instances in which the out-of-network 

rate exceeds the qualifying payment 

amount. The initiating party must send 

a notification to the Secretary and to the 

certified IDR entity (if selected) 

electronically, through the Federal IDR 

portal, as soon as possible, but no later 

than 3 business days after the date of the 

agreement. The notification must 

include the dispute number, a statement 

of the out-of-network rate for the 

qualified IDR item or service, and 

signatures from authorized signatories 

for both parties. 

(ii) Withdrawals. A dispute may be 

withdrawn from the Federal IDR process 

by the initiating party, the Secretary, or 

a certified IDR entity before a payment 

determination is made if one of the 

following conditions is met: 

(A) The initiating party provides 

notification through the Federal IDR 

portal to the Secretary and the certified 

IDR entity (if selected) that both parties 

to the dispute agree to withdraw the 

dispute from the Federal IDR process 

without agreement on an out-of-network 

rate. The notification must include the 

dispute number, a statement about both 

parties’ agreement to withdraw and 

signatures from authorized signatories 

for both parties. 

(B) The initiating party provides a 

standard withdrawal request notice 

through the Federal IDR portal to the 

Secretary, the certified IDR entity (if 

selected), and the non-initiating party of 

its request to withdraw the dispute from 

the Federal IDR process and the noninitiating party notifies the Secretary, 

certified IDR entity (if selected), and the 

initiating party through the Federal IDR 

portal of its agreement to withdraw from 

the Federal IDR process within 5 

business days of the initiating party’s 

request. If the non-initiating party fails 

to respond within 5 business days of the 

initiating party’s request, the noninitiating party will be considered to 

have agreed to the withdrawal, and the 

dispute will be withdrawn. 

(C) The certified IDR entity or 

Secretary cannot determine eligibility 

because both parties to the dispute are 

unresponsive to any requests for 

additional information to determine 

eligibility as described in paragraph 

(c)(2)(iii) of this section, or 

(D) The certified IDR entity cannot 

make a payment determination because 

both parties to the dispute have failed 

to submit an offer as described in 

paragraph (c)(5)(i) of this section. 

(4) Treatment of batched qualified 

IDR items and services—(i) In general. A 

certified IDR entity may consider up to 

25 qualified IDR items and services 

jointly as part of one payment 

determination that is subject to the 

certified IDR entity fee for batched 

determinations only if the qualified IDR 

items and services meet the 

requirements of this paragraph (c)(4)(i): 

* * * * * 

(B) Payment for the qualified IDR 

items and services is required to be 

made by the same group health plan or 

health insurance issuer. For group or 

individual health insurance coverage, 

this requirement is satisfied if the same 

issuer is required to make payment for 

the qualified IDR items and services, 

even if the qualified IDR items and 

services relate to claims from different 

group health plans or individual market 

policies. For self-insured group health 

plans, this requirement is satisfied if the 

same self-insured group health plan is 

required to make payment for the 

qualified IDR items and services, 

including when the plan makes 

payments through a third party 

administrator; the requirement is not 

satisfied if multiple self-insured group 

health plans are required to make 

payments for the qualified IDR items 

and services, even if those group health 

plans make payments through the same 

third party administrator; 

(C) The qualified IDR items and 

services meet any of the following 

criteria under which multiple qualified 

IDR items and services relate to the 

treatment of a similar condition and 

therefore are permitted to be considered 

jointly as a single payment 

determination for purposes of 

encouraging efficiencies (including 

minimizing costs) in the Federal IDR 

process: 


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(1) The qualified IDR items or services 

were furnished to a single patient 

during the same patient encounter. For 

purposes of this section, a single patient 

encounter is defined as a patient 

encounter on one or more consecutive 

days during which the qualified IDR 

items or services were furnished to the 

same patient and billed on the same 

claim form; or 

(2) The qualified IDR items and 

services were furnished to one or more 

patients and were billed under the same 

service code or a comparable code 

under a different procedural coding 

system, such as Current Procedural 

Terminology (CPT) codes with 

modifiers, if applicable, Healthcare 

Common Procedure Coding System 

(HCPCS) codes with modifiers, if 

applicable, or Diagnosis-Related Group 

(DRG) codes with modifiers, if 

applicable; or 

(3) For anesthesiology, radiology, 

pathology, and laboratory qualified IDR 

items and services, the qualified IDR 

items and services were furnished to 

one or more patients and were billed 

under service codes belonging to the 

same Category I CPT code range, as 

specified in guidance published by the 

Secretary; and 

(D) All the qualified IDR items and 

services were furnished within the same 

30-business-day period following the 

date on which the first item or service 

included in the batched determination 

was furnished and were the subjects of 

a 30-business-day open negotiation 

period that ended within 4 business 

days of IDR initiation, except as 

provided in paragraph (c)(5)(vii) of this 

section. 

(ii) Treatment of bundled payment 

arrangements. Qualified IDR items and 

services that meet the definition of a 

bundled payment arrangement under 

§ 2590.716–3 may be submitted and 

considered as a single payment 

determination, and the certified IDR 

entity must make a single payment 

determination for the multiple qualified 

IDR items and services included in the 

bundled payment arrangement. Bundled 

payment arrangements as defined in 

§ 2590.716–3 and submitted under this 

paragraph (c)(4)(ii) are subject to the 

certified IDR entity fee for single 

determinations. 

(5) * * * 

(i) Submission of offers. Not later than 

10 business days after the date of final 

selection of the certified IDR entity as 

described in paragraph (c)(1)(iv)(C) of 

this section (or not later than 10 

business days after the qualified IDR 

items and services are determined 

eligible as described in paragraph (c)(2) 

of this section, when the Secretary 

determines that any of the extenuating 

circumstances described in paragraph 

(g)(1)(ii) of this section apply), the plan 

or issuer and the provider, facility, or 

provider of air ambulance services: 

* * * * * 

(ii) Payment determination and 

notification. Not later than 30 business 

days after the date of final selection of 

the certified IDR entity as described in 

paragraph (c)(1)(iv)(C) of this section (or 

not later than 30 business days after the 

qualified IDR items and services are 

determined eligible as described in 

paragraph (c)(2) of this section, when 

the Secretary determines that any of the 

extenuating circumstances described in 

paragraph (g) of this section apply), the 

certified IDR entity must: 

(A) * * * 

(1) Prevailing party. In the case of 

single determinations, the party whose 

offer is selected by the certified IDR 

entity is considered the prevailing party. 

In the case of batched determinations, 

the party with the most determinations 

in its favor is considered the prevailing 

party; if each party prevails in an equal 

number of determinations, neither party 

will be considered the prevailing party, 

and the certified IDR entity fee will be 

split evenly between the parties. 

(2) Non-prevailing party. In the case of 

single determinations, the party whose 

offer is not selected by the certified IDR 

entity is considered the non-prevailing 

party. In the case of batched 

determinations, the party with the 

fewest determinations in its favor is 

considered the non-prevailing party. 

* * * * * 

(vii) Effects of determination. 

(A) * * * 

(B) Suspension of certain subsequent 

IDR requests. In the case of a 

determination made by a certified IDR 

entity under paragraph (c)(5)(ii) of this 

section, the party that submitted the 

initial notification under paragraph 

(b)(2) of this section may not submit a 

subsequent notification involving the 

same other party with respect to a claim 

for the same item or service that was the 

subject of the initial notification during 

the 90-calendar-day period following 

the determination. 

(C) Subsequent submission of requests 

permitted. If the end of the open 

negotiation period specified in 

paragraph (b)(1) of this section occurs 

during the 90-calendar-day suspension 

period regarding claims for the same 

item or service that were the subject of 

the initial notice of IDR determination 

as described in paragraph (c)(5)(vi) of 

this section, either party may initiate the 

Federal IDR process for those claims by 

submitting a notification as specified in 

paragraph (b)(2) of this section during 

the 30-business-day period beginning on 

the day after the last day of the 90- 

calendar-day suspension period. 

* * * * * 

(d) Costs of IDR process—(1) Certified 

IDR entity fee—(i) Timing of payment of 

certified IDR entity fee. Each party to a 

dispute for which there is a final 

selection of the certified IDR entity and 

a determination that the dispute is 

eligible for the Federal IDR process in 

accordance with paragraph (c)(2) of this 

section must pay to the certified IDR 

entity the predetermined certified IDR 

entity fee charged by the certified IDR 

entity. The certified IDR entity fee must 

be paid no later than the date a party 

submits its offer to the certified IDR 

entity, in accordance with paragraph 

(c)(5)(i) of this section. 

(ii) Failure to timely pay certified IDR 

entity fee. If a party fails to pay the 

certified IDR entity fee as specified in 

paragraph (d)(1)(i) of this section, that 

party’s offer will not be considered 

received. Such party will continue to be 

responsible for payment of the certified 

IDR entity fee. 

(iii) Method of allocation of the 

certified IDR entity fee after a payment 

determination. After making a payment 

determination, the certified IDR entity 

shall retain the certified IDR entity fee 

described under paragraph (d)(1)(i) of 

this section paid by the non-prevailing 

party as defined in paragraph 

(c)(5)(ii)(A)(2) of this section. The 

certified IDR entity must return the fee 

paid by the prevailing party, as defined 

in paragraph (c)(5)(ii)(A)(1) of this 

section, within 30 business days 

following the date of the certified IDR 

entity’s payment determination. In the 

event of a batched dispute in which 

each party prevails in an equal number 

of determinations, the certified IDR 

entity fee will be split evenly between 

the parties. In that case, the certified 

IDR entity must return half the fee paid 

by each party within 30 business days 

following the date of the certified IDR 

entity’s payment determination. 

(iv) Method of allocation of the 

certified IDR entity fee upon agreement 

or withdrawal after an eligibility 

determination. For a dispute for which 

there is a final selection of the certified 

IDR entity and a determination that the 

dispute is eligible for the Federal IDR 

process in accordance with paragraph 

(c)(2) of this section, unless directed 

otherwise by both parties, the certified 

IDR entity is required to return half of 

each party’s certified IDR entity fee 

within 30 business days of the date both 

parties notify the certified IDR entity 

that they have: 


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(A) Reached an agreement on an outof-network rate for qualified IDR items 

or services before the certified IDR 

entity has made its payment 

determination, as described in 

paragraph (c)(3)(i) of this section; or 

(B) Withdrawn the dispute before the 

certified IDR entity has made its 

payment determination, as described in 

paragraph (c)(3)(ii) of this section. 

(v) Method of allocation of the 

certified IDR entity fee upon agreement 

or withdrawal before an eligibility 

determination. When the parties reach 

an agreement on an out-of-network rate 

or withdraw a dispute for which there 

is a final selection of the certified IDR 

entity, but for which no eligibility 

determination has yet been made, 

unless directed otherwise by both 

parties, the certified IDR entity is 

required to return each party’s full 

certified IDR entity fee within 30 

business days of the date both parties 

notify the certified IDR entity that they 

have agreed on an out-of-network rate or 

agreed to withdraw the dispute. 

(2) Administrative fee—(i) In general. 

Each party to a dispute for which a 

certified IDR entity is selected under 

paragraph (c)(1) of this section must pay 

a non-refundable administrative fee to 

the Secretary for participating in the 

Federal IDR process. 

(A) Timing of payment of 

administrative fee. The initiating party 

must pay the administrative fee within 

2 business days of the date of 

preliminary selection of the certified 

IDR entity as described in paragraph 

(c)(1)(iii) of this section. The noninitiating party must pay the 

administrative fee within 2 business 

days of the date the non-initiating party 

receives notice that an eligibility 

determination for the Federal IDR 

process has been reached by either the 

certified IDR entity or the Departments 

in accordance with paragraph (c)(2) of 

this section. 

(B) Agreements and withdrawals. In 

the case of an agreement, as described 

in paragraph (c)(3)(i) of this section, or 

a withdrawal, as described in paragraph 

(c)(3)(ii) of this section, the 

administrative fee will not be returned 

to the parties if preliminary selection of 

the certified IDR entity has occurred, as 

described in paragraph (c)(1)(i) of this 

section; if not yet collected, the 

administrative fee must still be paid, 

except as provided in paragraph 

(d)(2)(i)(C) of this section for a dispute 

closed for nonpayment by an initiating 

party. 

(C) Failure to pay administrative fee. 

If the initiating party fails to pay the 

administrative fee in accordance with 

paragraph (d)(2)(i)(A) of this section, the 

dispute will be closed due to 

nonpayment and neither party will be 

responsible for the administrative fee. If 

the non-initiating party fails to pay the 

administrative fee in accordance with 

paragraph (d)(2)(i)(A) of this section, 

that party’s offer will not be considered 

received and the non-initiating party 

will continue to be responsible for 

payment of the administrative fee. 

(D) Collection of unpaid fees. Any 

party that fails to pay the administrative 

fee owed in accordance with paragraph 

(d)(2)(i)(A) of this section is obligated to 

pay the administrative fee otherwise 

due and owing, except as provided in 

paragraph (d)(2)(i)(C) of this section for 

a dispute closed for nonpayment by an 

initiating party. The Secretary will 

pursue collection from a party to a 

dispute of any administrative fee that is 

not timely paid pursuant to applicable 

debt collection authorities. 

(ii) Administrative fee amount. The 

administrative fee amount and method 

of payment will be established through 

notice and comment rulemaking in a 

manner such that the total 

administrative fees paid for a year, 

including administrative fees reduced 

under paragraph (d)(2)(iii) of this 

section, are estimated to be equal to the 

projected amount of expenditures made 

by the Secretaries of the Treasury, 

Labor, and Health and Human Services 

for the year in carrying out the Federal 

IDR process. 

(A) For disputes initiated on or after 

the later of the effective date of Federal 

Independent Dispute Resolution (IDR) 

Process Administrative Fee and 

Certified IDR Entity Fee Ranges final 

rules or January 1, 2024, the 

administrative fee amount is $150 per 

party per dispute, which will remain in 

effect until changed by subsequent 

rulemaking. 

(B) [Reserved] 

(iii) Reducing the administrative fee 

amount. For disputes initiated on or 

after January 1, 2025— 

(A) The Secretary may reduce the 

administrative fee for both parties in 

accordance with paragraph (d)(2)(iii)(C) 

of this section when the highest offer 

made by either party during open 

negotiation for the dispute is less than 

the threshold established in notice and 

comment rulemaking pursuant to 

paragraph (d)(2)(ii) of this section. For a 

dispute that satisfies the requirements 

for a reduced administrative fee in 

accordance with this paragraph and for 

which a determination has been made 

that the dispute is eligible for the 

Federal IDR process in accordance with 

paragraph (c)(2) of this section, the 

administrative fee amount may be 

reduced to 50 percent of the 

administrative fee amount as described 

in paragraph (d)(2)(ii) of this section for 

each party to the dispute. For a dispute 

that satisfies the requirements for a 

reduced administrative fee in 

accordance with this paragraph and for 

which a determination has been made 

that the dispute is ineligible for the 

Federal IDR process in accordance with 

paragraph (c)(2) of this section, the 

administrative fee amount may be 

reduced to 50 percent of the 

administrative fee amount as described 

in paragraph (d)(2)(ii) of this section for 

the initiating party and to 20 percent of 

the administrative fee amount for the 

non-initiating party. 

(B) The Secretary may reduce the 

administrative fee for a non-initiating 

party in accordance with paragraph 

(d)(2)(iii)(C) of this section when the 

dispute is determined to be ineligible 

for the Federal IDR process in 

accordance with paragraph (c)(2) of this 

section. For a dispute that satisfies the 

requirements for a reduced 

administrative fee in accordance with 

this paragraph, the administrative fee 

amount for the non-initiating party may 

be reduced to 20 percent of the 

administrative fee amount as described 

in paragraph (d)(2)(ii) of this section. 

(C) The reduced administrative fee 

amounts provided for in paragraphs 

(d)(2)(iii)(A) and (d)(2)(iii)(B) of this 

section shall be established in notice 

and comment rulemaking and will 

remain in effect until changed by 

subsequent rulemaking, pursuant to 

paragraph (d)(2)(ii) of this section. 

(e) * * * 

(2) * * * 

(vi) Meet appropriate indicators of 

fiscal integrity and stability by 

demonstrating that the certified IDR 

entity has a system of safeguards and 

controls in place to prevent and detect 

improper financial activities by its 

employees and agents to assure fiscal 

integrity and accountability for all 

certified IDR entity fees and 

administrative fees (if applicable) 

received, held, and disbursed and by 

submitting 3 years of financial 

statements or, if not available, other 

information to demonstrate fiscal 

stability of the certified IDR entity; 

* * * * * 

(viii) Have a procedure in place to 

retain the certified IDR entity fees 

described in paragraph (d)(1) of this 

section paid by both parties in a trust or 

escrow account and to return the 

certified IDR entity fee paid by the 

prevailing party or a portion of each 

party’s certified IDR entity fee in the 

case of an agreement described in 

paragraph (c)(3)(i) of this section, a 


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withdrawal described in paragraph 

(c)(3)(ii) of this section, or a 

circumstance described under 

paragraph (d)(1)(iii) of this section, 

within 30 business days following the 

date of the determination; 

(ix) Have a procedure in place to 

retain the administrative fees (if 

applicable) described in paragraph 

(d)(2) of this section and to remit the 

administrative fees to the Secretary in 

accordance with the timeframe and 

procedures set forth in guidance 

published by the Secretary; 

* * * * * 

(g) Extension of time periods for 

extenuating circumstance—(1) In 

general. The time periods specified in 

this section (other than the time for 

payment, if applicable, under paragraph 

(c)(5)(ix) of this section) may be 

extended in extenuating circumstances 

at the Secretary’s discretion. 

Extenuating circumstances include, but 

are not limited to when: 

(i) With respect to a specific dispute, 

the Secretary determines that the parties 

or certified IDR entity cannot meet 

applicable timeframes due to matters 

beyond the control of one or both 

parties or the certified IDR entity, or for 

other good cause. The certified IDR 

entity or either party may also submit a 

request for an extension due to 

extenuating circumstances to the 

Secretary through the Federal IDR 

portal. The requesting certified IDR 

entity or party must attest that it will 

take prompt action to ensure that the 

certified IDR entity’s payment 

determination under this section may be 

made as soon as administratively 

practicable under the circumstances; or 

(ii) The Secretary determines that the 

parties or certified IDR entity cannot 

meet applicable timeframes due to 

systematic delays in processing disputes 

under the Federal IDR process, such as 

an unforeseen volume of disputes or 

Federal IDR portal system failures. 

Extensions provided due to extenuating 

circumstances caused by an unforeseen 

volume of disputes will be applied to 

the timeframe for eligibility 

determinations under paragraph (c)(2) of 

this section. Extensions provided due to 

extenuating circumstances caused by 

systems failures within the Federal IDR 

portal will be applied to the Federal IDR 

process timeframe(s) determined 

relevant by the Secretary. The Secretary 

will post a public notice regarding any 

extensions of time periods pursuant to 

this paragraph (g)(1)(ii). 

(A) Timeframe following an extension 

to eligibility determination. When an 

extension to the eligibility 

determination timeframe pursuant to 

paragraph (g)(1)(ii) of this section is in 

effect, the start date of the subsequent 

timeframes in the Federal IDR process 

will be determined based on the date of 

completion of the eligibility 

determination by the certified IDR entity 

or the Secretary. 

(1) Submission of offers. The parties 

must submit their offers and certified 

IDR entity fees to the certified IDR entity 

not later than 10 business days after the 

qualified IDR items and services are 

determined eligible as described in 

paragraph (c)(2) of this section. 

(2) Payment Determination. The 

certified IDR entity must make the 

payment determination and notification 

of the payment determination to the 

parties not later than 30 business days 

after the qualified IDR items and 

services are determined eligible as 

described in paragraph (c)(2) of this 

section. 

(B) Timeframe following an extension 

to other timeframes in the Federal IDR 

process. When an extension to any 

timeframe within the Federal IDR 

process, other than the eligibility 

timeframe, is in effect pursuant to 

paragraph (g)(1)(ii) of this section, the 

start date of each subsequent timeframe 

in the Federal IDR process will be 

determined based on the date of 

completion of the process for which the 

extension was granted. 

(2) [Reserved] 

(h) Applicability date. (1) Paragraph 

(a) of this section is applicable with 

respect to plan years beginning on or 

after January 1, 2022, except that the 

provisions regarding IDR entity 

certification at paragraphs (a) and (e) of 

this section are applicable beginning on 

October 7, 2021, and the revised 

definition for batched qualified IDR 

items and services at paragraph (a)(2)(i) 

of this section is applicable to disputes 

with open negotiation periods beginning 

on or after the later of August 15, 2024, 

or 90 days after the effective date of the 

rule. 

(2) Paragraph (b) of this section is 

applicable to disputes with open 

negotiation periods beginning on or 

after the later of August 15, 2024, or 90 

days after the effective date of the rule. 

(3) Paragraph (c)(1) of this section, 

regarding the selection of a certified IDR 

entity, is applicable to disputes with 

open negotiation periods beginning on 

or after the later of August 15, 2024, or 

90 days after the effective date of the 

rule, except that paragraphs 

(c)(1)(iv)(A)(1) through (3) of this 

section, regarding the conflict-of-interest 

standards, are applicable with respect to 

plan years beginning on or after January 

1, 2022. 

(4) Paragraph (c)(2) of this section, 

regarding the Federal IDR process 

eligibility review and paragraph (c)(3) of 

this section regarding the authority to 

continue negotiations or withdraw are 

applicable to disputes with open 

negotiation periods beginning on or 

after the later of August 15, 2024, or 90 

days after the effective date of the rule, 

and paragraph (c)(4) of this section 

regarding the treatment of batched and 

bundled qualified IDR items and 

services is applicable 90 days after the 

effective date of the rule. 

(5) Paragraphs (c)(5)(i) and (ii), and 

(c)(5)(vii)(B) and (C) of this section 

regarding the deadlines for the 

submission of offers, payment 

determination and notification, 

suspension of certain subsequent IDR 

requests, and subsequent submission of 

requests submitted are applicable to 

disputes with open negotiation periods 

beginning on or after the later of August 

15, 2024, or 90 days after the effective 

date of the rule. Paragraphs (c)(5)(iii) 

and (iv) of this section regarding 

considerations in payment 

determinations and the related 

examples and paragraph (c)(5)(vi)(B) of 

this section regarding written decisions 

are applicable with respect to items or 

services furnished on or after October 

25, 2022, for plan years beginning on or 

after January 1, 2022. Paragraphs 

(c)(5)(v) through (c)(5)(vi)(A), 

(c)(5)(vii)(A), and (c)(5)(viii) and (ix) are 

applicable with respect to plan years 

beginning on or after January 1, 2022. 

(6) Paragraph (d) of this section 

regarding the costs of the IDR process is 

applicable to disputes initiated on or 

after January 1, 2025. 

(7) Paragraph (e) of this section is 

applicable with respect to plan years 

beginning on or after January 1, 2022, 

except that the provisions regarding IDR 

entity certification at paragraphs (e)(1), 

(e)(2)(i) through (vi), (e)(2)(x) and (xi), 

and (e)(3) through (6) of this section are 

applicable beginning on October 7, 

2021. Paragraphs (e)(2)(vi), (viii), and 

(ix) of this section regarding the 

certified IDR entity’s controls to prevent 

and detect improper financial activities, 

and procedures to retain the certified 

IDR entity fee and administrative fee are 

applicable upon the effective date of the 

rule. 

(8) Paragraph (f) of this section is 

applicable with respect to plan years 

beginning on or after January 1, 2022, 

except that paragraph (f)(1)(v)(F) of this 

section regarding reporting of 

information relating to the Federal IDR 

process is applicable with respect to 

items or services furnished on or after 

October 25, 2022, for plan years 

beginning on or after January 1, 2022. 


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(9) Paragraph (g) of this section 

regarding the extension of time periods 

for extenuating circumstances is 

applicable to disputes with open 

negotiation periods beginning on or 

after the later of August 15, 2024, or 90 

days after the effective date of the rule. 

(10) Until the relevant applicability 

date for the requirements of this section, 

plans, issuers, providers, facilities, 

providers of air ambulance services and 

certified IDR entities are required to 

continue to comply with the 

corresponding section of § 2590.716–8 

in effect on October 25, 2022. 

(i) Severability. (1) Any provision of 

this section held to be invalid or 

unenforceable by its terms, or as applied 

to any person or circumstance, shall be 

construed so as to continue to give 

maximum effect to the provision 

permitted by law, unless such holding 

shall be one of utter invalidity or 

unenforceability, in which event the 

provision shall be severable from this 

section and shall not affect the 

remainder thereof or the application of 

the provision to persons not similarly 

situated or to dissimilar circumstances. 

(2) The provisions of paragraphs 

(b)(1), (c)(2)(ii), (c)(4), (d)(2), and (g)(1) 

of this section are intended to be 

severable from one another, from any 

grant of forbearance from removal 

resulting from this subpart, and from 

any provision referenced in those 

paragraphs. The provisions in 

§ 2590.716–8 are intended to be 

severable from the provisions in 

§§ 2590.716–6A, 2590.716–6, and 

2590.716–9, from any grant of 

forbearance from removal resulting from 

this subpart, and from any provision 

referenced in §§ 2590.716–6A, 

2590.716–6, and 2590.716–9. 

■ 17. Section 2590.716–9 is added to 

subpart F to read as follows: 

§ 2590.716–9 Federal Independent Dispute 

Resolution Registry of Group Health Plans, 

Health Insurance Issuers, and Federal 

Employees Health Benefits Carriers. 

(a) Establishment of Federal 

independent dispute resolution registry. 

The Secretary, jointly with the Secretary 

of the Treasury and the Secretary of 

Health and Human Services, will 

establish a Federal IDR registry 

consisting of the information described 

in paragraph (b)(2) of this section and 

will assign a registration number for 

each group health plan, health 

insurance issuer offering group or 

individual health insurance coverage, 

and Federal Employees Health Benefits 

(FEHB) Program carrier. The 

information contained in the registry 

will be made available to parties seeking 

to initiate an open negotiation or a 

dispute through the Federal IDR portal, 

and will be searchable, including by 

registration number. 

(b) Federal IDR registration—(1) 

Registration requirement. Each group 

health plan and health insurance issuer 

offering group health insurance 

coverage subject to the Federal IDR 

process must register with the Federal 

IDR registry as specified by the 

Secretary in guidance. Initial 

registration must be completed by the 

later of the date that is 30 business days 

after the effective date of the final rule, 

the date that is 30 business days after 

the registry becomes available, or the 

date the group health plan or health 

insurance issuer begins offering a group 

health plan or health insurance coverage 

subject to the Federal IDR process. 

(2) Required data elements. Group 

health plans and health insurance 

issuers offering group health insurance 

coverage subject to the registration 

requirement must include the following 

information with their registration: 

(i) The legal business name (if any) of 

the group health plan, or issuer, and, if 

applicable, the legal business name of 

the group health plan sponsor; 

(ii) Whether the plan or coverage is a 

self- or fully-insured group health plan 

subject to ERISA; 

(iii) The State(s) in which the plan or 

coverage is subject to a specified State 

law, as defined in § 2590.716–3 for any 

items or services for which the 

protections of §§ 2590.716–4, 2590.716– 

5, and 2590.717–1 apply; 

(iv) The State(s) in which the plan or 

coverage is subject to an All-Payer 

Model Agreement under section 1115A 

of the Social Security Act for any items 

or services to which the protections in 

§§ 2590.716–4, 2590.716–5, and 

2590.717–1 apply; 

(v) For self-insured group health plans 

not otherwise subject to State law, any 

State(s) in which the group health plan 

has properly effectuated an election to 

opt in to a specified State law as defined 

in § 2590.716–3, if that State allows a 

plan not otherwise subject to the State 

law to opt-in; 

(vi) Contact information, including a 

telephone number and email address, 

for the appropriate person or office to 

initiate open negotiations for purposes 

of determining an amount of payment 

(including cost sharing) for such item or 

service; 

(vii) The 14-digit Health Insurance 

Oversight System (HIOS) identifier; or if 

the 14-digit HIOS identifier has not been 

assigned, the 5-digit HIOS identifier; or 

if no HIOS identifier is available, the 

plan’s or the plan sponsor’s Employer 

Identification Number (EIN) and the 

plan’s plan number (PN), if a PN is 

available; 

(viii) Additional information needed 

to identify the plan or issuer and the 

applicable Federal and State 

requirements for determining 

appropriate out-of-network payment 

rates for items or services to which the 

protections against balance billing in 

this part apply, as specified by the 

Secretary in guidance; and 

(ix) Additional information needed 

for purposes of administrative fee 

collection, as specified by the Secretary 

in guidance. 

(3) Updating disclosures. A plan or 

issuer must timely report to the 

Secretary changes to the information 

required under this section within 30 

calendar days after the information 

changes. A plan or issuer must confirm 

the accuracy of its registration annually 

in the fourth quarter of each calendar 

year. 

(4) Third party authority. The 

requirements of paragraphs (b)(1) 

through (3) of this section may be 

performed by a third party administrator 

or service provider with authority to act 

on behalf of the group health plan or 

health insurance issuer offering group 

health insurance coverage subject to the 

Federal IDR process. If the registration 

requirements are performed by such 

third party administrator or service 

provider the group health plan or health 

insurance issuer offering group or 

individual health insurance coverage 

must require that such third party 

administrator or service provider clearly 

delineate each group health plan or 

health insurance issuer offering group 

health insurance coverage for which it 

has authority to act. If such third party 

administrator or service provider fails to 

provide the information in compliance 

with the requirements of paragraphs 

(b)(1) through (3) of this section the plan 

or issuer will be in violation of the 

requirements of this section. 

(c) Severability. (1) Any provision of 

this section held to be invalid or 

unenforceable by its terms, or as applied 

to any person or circumstance, shall be 

construed so as to continue to give 

maximum effect to the provision 

permitted by law, unless such holding 

shall be one of utter invalidity or 

unenforceability, in which event the 

provision shall be severable from this 

section and shall not affect the 

remainder thereof or the application of 

the provision to persons not similarly 

situated or to dissimilar circumstances. 

(2) The provisions in § 2590.716–9 are 

intended to be severable from the 

provisions in §§ 2590.716–6A, 

2590.716–6, and 2590.716–8, from any 

grant of forbearance from removal 


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resulting from this subpart, and from 

any provision referenced in 

§§ 2590.716–6A, 2590.716–6, and 

2590.716–8. 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

For the reasons stated in the 

preamble, the Department of Health and 

Human Services proposes to amend 45 

CFR part 149 as set forth below: 

PART 149—SURPRISE BILLING AND 

TRANSPARENCY REQUIREMENTS 

■ 18. The authority citation for part 149 

continues to read as follows: 

Authority: 42 U.S.C. 300gg–92 and 300gg– 

111 through 300gg–139, as amended. 

Subpart A—General Provisions 

■ 19. Section 149.30 is amended by 

adding the definition of ‘‘Bundled 

payment arrangement’’ in alphabetical 

order to read as follows: 

§ 149.30 Definitions. 

* * * * * 

Bundled payment arrangement means 

an arrangement under which— 

(1) A provider, facility, or provider of 

air ambulance services bills for multiple 

items or services furnished to a single 

patient under a single service code that 

represents multiple items or services 

(for example, a Diagnosis-Related Group 

(DRG) code); or 

(2) A plan or issuer makes an initial 

payment or notice of denial of payment 

to a provider, facility, or provider of air 

ambulance services under a single 

service code that represents multiple 

items or services furnished to a single 

patient (for example, a DRG code). 

* * * * * 

Subpart B—Requirements Relating to 

Health Care Access 

■ 20. Section 149.100 is added to 

subpart B to read as follows: 

§ 149.100 Use of claim adjustment reason 

codes and remittance advice remark codes. 

(a) In general. When providing any 

paper or electronic remittance advice to 

an entity that does not have a 

contractual relationship directly or 

indirectly with a group health plan or a 

health insurance issuer offering group or 

individual health insurance coverage 

with respect to the furnishing of the 

item or service under the plan or 

coverage in response to a claim for 

payment for health care items and 

services furnished by that entity, the 

plan or issuer must use claim 

adjustment reason codes (CARCs) and 

remittance advice remark codes 

(RARCs) (see 45 CFR 162.1602 and 

162.1603) as specified in guidance 

issued by the Secretaries of the 

Treasury, Labor, and Health and Human 

Services, or as required under any 

applicable adopted standards and 

operating rules under 45 CFR part 162, 

to communicate information related to 

whether the claim is or is not subject to 

the provisions of this subpart and 

subparts E and F of this part. 

(b) Severability. (1) Any provision of 

this section held to be invalid or 

unenforceable by its terms, or as applied 

to any person or circumstance, shall be 

construed so as to continue to give 

maximum effect to the provision 

permitted by law, unless such holding 

shall be one of utter invalidity or 

unenforceability, in which event the 

provision shall be severable from this 

section and shall not affect the 

remainder thereof or the application of 

the provision to persons not similarly 

situated or to dissimilar circumstances. 

(2) The provisions in § 149.100 are 

intended to be severable from the 

provisions in §§ 149.140, 149.510, and 

149.530, from any grant of forbearance 

from removal resulting from this 

subpart, and from any provision 

referenced in §§ 149.140, 149.510, and 

149.530. 

■ 21. Section 149.140 is amended by: 

■ a. Revising paragraphs (d) 

introductory text and (d)(1)(iv); 

■ b. Redesignating paragraph (d)(1)(v) as 

paragraph (d)(1)(vi); 

■ c. Adding a new paragraph (d)(1)(v); 

■ d. Revising paragraph (d)(2) 

introductory text; and 

■ e. Adding paragraph (h). 

The revisions and additions read as 

follows: 

§ 149.140 Methodology for calculating 

qualifying payment amount. 

* * * * * 

(d) Information to be shared about the 

qualifying payment amount. In cases in 

which the recognized amount, with 

respect to an item or service furnished 

by a nonparticipating provider or 

nonparticipating emergency facility, is 

the qualifying payment amount or the 

amount billed by the provider or 

facility, or if the amount on which cost 

sharing is based with respect to air 

ambulance services furnished by a 

nonparticipating provider of air 

ambulance services is the qualifying 

payment amount or the amount billed 

by the provider of air ambulance 

services, the plan or issuer must provide 

to the provider, facility, or provider of 

air ambulance services, as applicable, in 

writing, in paper or electronic form— 

(1) * * * 

(iv) A statement that— 

(A) If the provider, facility, or 

provider of air ambulance services, as 

applicable, wishes to initiate a 30- 

business-day open negotiation period 

for purposes of determining the out-ofnetwork rate, the provider, facility, or 

provider of air ambulance services must: 

(1) Contact the appropriate person or 

office to initiate open negotiation within 

30 business days of receiving the initial 

payment or notice of denial of payment, 

and 

(2) For disclosures required to be 

provided on or after [DATE 90 DAYS 

AFTER PUBLICATION OF FINAL 

REGULATIONS IN THE FEDERAL 

REGISTER] and once the open 

negotiation notice can be submitted 

through the Federal IDR portal, notify 

the Secretary as described under 

§ 149.510(b)(1)(i); and 

(B) If the 30-business-day open 

negotiation period does not result in an 

agreement on the amount of payment 

the provider, facility, or provider of air 

ambulance services may generally 

initiate the Federal IDR process within 

4 business days after the end of the open 

negotiation period; 

(v) For disclosures required to be 

provided on or after [DATE 90 DAYS 

AFTER PUBLICATION OF FINAL 

REGULATIONS IN THE FEDERAL 

REGISTER], the legal business name of 

the group health plan (if any) or issuer, 

the legal business name of the plan 

sponsor (if applicable), and the 

registration number assigned under 

§ 149.530, if the plan or issuer is 

registered under § 149.530. 

* * * * * 

(2) In a timely manner upon the 

request of the provider, facility, or 

provider of air ambulance services: 

* * * * * 

(h) Severability. (1) Any provision of 

this section held to be invalid or 

unenforceable by its terms, or as applied 

to any person or circumstance, shall be 

construed so as to continue to give 

maximum effect to the provision 

permitted by law, unless such holding 

shall be one of utter invalidity or 

unenforceability, in which event the 

provision shall be severable from this 

section and shall not affect the 

remainder thereof or the application of 

the provision to persons not similarly 

situated or to dissimilar circumstances. 

(2) The provisions in § 149.140 are 

intended to be severable from the 

provisions in §§ 149.100, 149.510, and 

149.530, from any grant of forbearance 

from removal resulting from this 

subpart, and from any provision 

referenced in §§ 149.100, 149.510, and 

149.530. 

■ 22. Section 149.510 is amended by: 

■ a. Revising paragraphs (a)(2)(i), (b), 

and (c)(1); 


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■ b. Redesignating paragraphs (c)(2) 

through (4) as paragraphs (c)(3) through 

(5), respectively; 

■ c. Adding a new paragraph (c)(2); 

■ d. Revising newly redesignated 

paragraphs (c)(3), (c)(4)(i) introductory 

text, (c)(4)(i)(B) through (D), (c)(4)(ii), 

(c)(5)(i) introductory text, (c)(5)(ii) 

introductory text; 

■ e. In newly redesignated paragraphs 

(c)(5)(ii)(A) and (B), removing the 

reference to ‘‘(c)(4)’’ and adding in its 

place ‘‘(c)(5)’’; 

■ f. Adding paragraphs (c)(5)(ii)(A)(1) 

and (2); 

■ g. Adding paragraphs (c)(5)(vii)(B) and 

(C); 

■ h. Revising paragraphs (d), (e)(2)(vi), 

(viii), and (ix), (g), and (h); and 

■ i. Adding paragraph (i). 

The revisions and additions read as 

follows: 

§ 149.510 Independent dispute resolution 

process. 

(a) * * * 

(2) * * * 

(i) Batched qualified IDR items and 

services means multiple qualified IDR 

items or services that are considered 

jointly as part of one payment 

determination by a certified IDR entity 

for purposes of the Federal IDR process 

in accordance with paragraph (c)(4) of 

this section. 

* * * * * 

(b) Determination of payment amount 

through open negotiation and initiation 

of the Federal IDR process—(1) 

Determination of payment amount 

through open negotiation—(i) In 

general. With respect to an item or 

service that meets the requirements of 

paragraph (a)(2)(xi)(A) of this section, 

the provider, facility, or provider of air 

ambulance services, or the group health 

plan or health insurance issuer offering 

group or individual health insurance 

coverage may, during the 30-businessday period beginning on the day the 

provider, facility, or provider of air 

ambulance services receives an initial 

payment or notice of denial of payment 

regarding the item or service, initiate an 

open negotiation period for purposes of 

determining the out-of-network rate for 

such item or service. To initiate the 

open negotiation period, a party must 

submit a written open negotiation notice 

with the content specified in paragraph 

(b)(1)(ii) of this section to the other 

party and to the Secretary in the manner 

specified in paragraph (b)(3) of this 

section. The 30-business-day open 

negotiation period begins on the day on 

which the party first submits the open 

negotiation notice and the remittance 

advice documentation specified in 

paragraph (b)(1)(ii)(A)(12) of this section 

to the other party and the Secretary. The 

party in receipt of the open negotiation 

notice must provide to the other party 

and to the Secretary in the manner 

specified in paragraph (b)(3) of this 

section as soon as practicable, but no 

later than the 15th business day of the 

30-business-day open negotiation 

period, a written notice and supporting 

documentation in response to the open 

negotiation notice, as specified in 

paragraph (b)(1)(iii)(A) of this section. 

(ii) Open negotiation notice—(A) 

Content. The open negotiation notice 

must include, with respect to the item 

or service that is the subject of the open 

negotiation notice, information about 

the item or service and the parties 

including: 

(1) Information sufficient to identify 

the provider, facility, or provider of air 

ambulance services, including the name 

and current contact information 

(including the legal business name, 

email address, phone number, and 

mailing address) as provided with the 

claim form submitted by the provider, 

facility, or air ambulance provider to the 

plan or issuer, and the National 

Provider Identifier (NPI); 

(2) Information sufficient to identify 

the plan or issuer, including the plan’s 

or issuer’s registration number, as 

required under § 149.530, if the plan or 

issuer is registered under § 149.530, or 

an attestation from the party submitting 

the open negotiation notice that the plan 

or issuer was not registered prior to the 

date it submitted the notice; the legal 

business name of the plan or issuer, as 

well as the current contact information 

(name, email address, phone number, 

and mailing address) of the plan or 

issuer as provided with the initial 

payment or notice of denial of payment; 

and if the party submitting the open 

negotiation notice is a plan or issuer, the 

plan type (for example, self-insured or 

fully-insured); 

(3) The name and contact information 

(including the legal business name, 

email address, phone number, and 

mailing address) for any third party 

representing the party submitting the 

open negotiation notice, and an 

attestation that the third party has the 

authority to act on behalf of the party it 

represents in the open negotiation; 

(4) Information sufficient to identify 

the item or service, including: the 

date(s) the item or service was furnished 

and, if the party submitting the open 

negotiation notice is a provider, facility, 

or provider of air ambulance services, 

the date(s) that the provider, facility, or 

provider of air ambulance services 

received the initial payment or notice of 

denial of payment for the item or service 

from the plan or issuer; the type of item 

or service (specifically, whether the 

item or service is an emergency service 

as defined in § 149.110(c)(2)(i) or (ii), a 

non-emergency service as described in 

§ 149.120(b), or an air ambulance 

service as defined in § 149.30); whether 

the service is a professional service or 

facility-based service; the State where 

the item or service was furnished; the 

claim number; the service code; and 

information to identify the location 

where the item or service was furnished 

(such as, place of service code or bill 

type code); 

(5) The initial payment amount 

(including $0 if, for example, payment 

is denied); 

(6) The qualifying payment amount, if 

provided with the initial payment or 

notice of denial of payment or if the 

party submitting the open negotiation 

notice is a plan or issuer; 

(7) An offer of an out-of-network rate 

for each item or service; 

(8) If the party submitting the open 

negotiation notice is a plan or issuer, the 

amount of cost sharing imposed for the 

item or service, if any; 

(9) If the party submitting the open 

negotiation notice is a provider or 

facility, a statement that the items and 

services do not qualify for the notice 

and consent exception described at 

§ 149.410(b) or § 149.420(c) through (i); 

(10) A statement that the provider, 

facility, or provider of air ambulance 

services was a nonparticipating 

provider, nonparticipating emergency 

facility, or nonparticipating provider of 

air ambulance services on the date the 

item or service was furnished; 

(11) General information listed in the 

standard open negotiation notice 

developed by the Secretary pursuant to 

paragraph (b)(3) of this section 

describing the open negotiation period 

and the Federal IDR process (including 

a description of the purpose of the open 

negotiation period and Federal IDR 

process and key deadlines in the open 

negotiation period and Federal IDR 

process); and 

(12) A copy of the initial payment or 

notice of denial of payment or other 

remittance advice that is required to 

include the disclosures under 

§ 149.140(d)(1), with respect to the item 

or service. 

(B) [Reserved] 

(iii) Open negotiation response 

notice—(A) Content. The response to 

the open negotiation notice must 

include, with respect to the item or 

service that is the subject of the open 

negotiation response notice, information 

about the item or service and the parties 

including: 

(1) Information sufficient to identify 

the provider, facility, or provider of air 


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ambulance services, including the name 

and current contact information 

(including the legal business name, 

email address, phone number, and 

mailing address) as provided with the 

claim form submitted by the provider, 

facility, or provider of air ambulance 

services to the plan or issuer, and the 

NPI; 

(2) Information sufficient to identify 

the plan or issuer, including the plan’s 

or issuer’s registration number, as 

required under § 149.530 if the plan or 

issuer is registered under § 149.530, or 

an attestation from the party submitting 

the open negotiation response notice 

that the plan or issuer was not registered 

prior to the date it submitted the notice; 

the legal business name of the plan or 

issuer, as well as the current contact 

information (name, email address, 

phone number, and mailing address) of 

the plan or issuer as provided with the 

initial payment or notice of denial of 

payment; and if the party submitting the 

open negotiation response notice is a 

plan or issuer, the plan type (for 

example, self-insured or fully-insured); 

(3) The name and contact information 

(including the legal business name, 

email address, phone number, and 

mailing address) for any third party 

representing the party submitting the 

open negotiation response notice, and 

an attestation that the third party has 

the authority to act on behalf of the 

party it represents in the open 

negotiation; 

(4) Information sufficient to identify 

the item or service included in the open 

negotiation notice, including the date(s) 

the item or service was furnished, and 

if the party submitting the open 

negotiation response notice is a 

provider, facility, or provider of air 

ambulance services, the date(s) that the 

provider, facility, or provider of air 

ambulance services received the initial 

payment or notice of denial of payment 

for such item or service from the plan 

or issuer, and the claim number; 

(5) If the party submitting the open 

negotiation response notice is a plan or 

issuer, a statement as to whether it 

agrees that the initial payment amount 

(including $0 if, for example, payment 

is denied) and the qualifying payment 

amount reflected in the open 

negotiation notice accurately reflect the 

initial payment amount and qualifying 

payment amount disclosed with the 

initial payment for the item or service, 

and if not, or if the open negotiation 

notice indicates that the initial payment 

amount or qualifying payment amount 

was not communicated by the plan or 

issuer with the initial payment or notice 

of denial of payment or other remittance 

advice, the initial payment amount 

(including $0 if, for example, payment 

is denied) and/or qualifying payment 

amount it believes to be correct, and 

documentation to support the statement 

(for example, the remittance advice 

confirming the qualifying payment 

amount); 

(6) If the party submitting the open 

negotiation response notice is a plan or 

issuer, the amount of cost sharing 

imposed for the item or service, if any; 

(7) A counteroffer for an out-ofnetwork rate for each item or service or 

an acceptance of the other party’s offer; 

(8) If the party submitting the open 

negotiation response notice is a provider 

or facility, a statement that the items 

and services do not qualify for the 

notice and consent exception described 

at § 149.410(b) or § 149.420(c) through 

(i); 

(9) With respect to each item or 

service, either a statement and 

supporting documentation that explains 

why the item or service is not subject to 

the Federal IDR process or a statement 

agreeing that the item or service is 

subject to the Federal IDR process; 

(10) A statement as to whether any of 

the information provided in the open 

negotiation notice is inaccurate and the 

basis for the statement, as well as 

supporting documentation; and 

(11) A statement confirming that the 

initial payment or notice of denial of 

payment or other remittance advice 

provided by the party submitting the 

open negotiation notice under 

paragraph (b)(1)(ii)(A)(12) of this section 

is accurate, and if inaccurate, a copy of 

the accurate initial payment or notice of 

denial of payment or other remittance 

advice required to include the 

disclosures under § 149.140(d)(1), with 

respect to the item or service. 

(B) [Reserved] 

(2) Initiating the Federal IDR 

process—(i) In general. Either party may 

initiate the Federal IDR process with 

respect to a qualified IDR item or service 

for which the parties do not agree upon 

an out-of-network rate by the last day of 

the open negotiation period provided 

for under paragraph (b)(1) of this 

section. To initiate the Federal IDR 

process, a party (the initiating party) 

must submit a written notice of IDR 

initiation, consistent with paragraph 

(b)(2)(ii) of this section, to the other 

party to the dispute (the non-initiating 

party), and to the Secretary in the 

manner specified in paragraph (b)(3) of 

this section, during the 4-business-day 

period beginning on the first business 

day after the last day of the open 

negotiation period (unless it is 

otherwise required to be submitted in 

the timeframe specified in paragraph 

(c)(5)(vii)(C) of this section). The date of 

IDR initiation is the date that the 

Secretary receives the notice of IDR 

initiation described in paragraph 

(b)(2)(ii) of this section. 

(A) Exception for items and services 

provided by certain nonparticipating 

providers and facilities. A party may not 

initiate the Federal IDR process with 

respect to an item or service if, with 

respect to that item or service, the party 

knows (or reasonably should have 

known) that the provider or facility 

provided notice and received consent 

under §§ 149.410(b) or 149.420(c) 

through (i). 

(B) [Reserved] 

(ii) Notice of IDR initiation—(A) 

Content. The notice of IDR initiation 

must include, with respect to the item 

or service that is the subject of the 

notice, information about the item or 

service and the parties including: 

(1) Information sufficient to identify 

the provider, facility, or provider of air 

ambulance services, including the name 

and current contact information 

(including the legal business name, 

email address, phone number, and 

mailing address), and the NPI; and if the 

initiating party is a provider, facility, or 

provider of air ambulance services, the 

Tax Identification Number (TIN); 

(2) Information sufficient to identify 

the plan or issuer, including the plan’s 

or issuer’s registration number, as 

required under § 149.530 if the plan or 

issuer is registered under § 149.530, or 

an attestation from the initiating party 

that the plan or issuer was not registered 

prior to the date that it submitted the 

notice; the legal business name of the 

plan or issuer, as well as the current 

contact information (name, email 

address, phone number, and mailing 

address) of the plan or issuer as 

provided with the initial payment or 

notice of denial of payment; and if the 

initiating party is a plan or issuer, the 

plan type (for example, self-insured or 

fully-insured) and TIN (or, in the case 

of a plan that does not have a TIN, the 

TIN of the plan sponsor); 

(3) The name and contact information 

(including the legal business name, 

email address, phone number, and 

mailing address) for any third party 

representing the initiating party, and an 

attestation that the third party has the 

authority to act on behalf of the party it 

represents in the Federal IDR process; 

(4) Information sufficient to identify 

whether the dispute being initiated 

includes batched or bundled qualified 

IDR items or services as described in 

paragraph (c)(4) of this section; 

(5) Information sufficient to identify 

the qualified IDR item or service that is 

the subject of the notice of IDR 

initiation, including the date(s) the 


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qualified IDR item or service was 

furnished; if the initiating party is a 

provider, facility, or provider of air 

ambulance services, the date(s) that the 

provider, facility, or provider of air 

ambulance services received the initial 

payment or notice of denial of payment 

for such item or service from the plan 

or issuer; the date the open negotiation 

period under paragraph (b)(1) of this 

section began; the type of item or 

service (specifically, whether the 

qualified IDR item or service is an 

emergency service as defined in 

§ 149.110(c)(2)(i) or (ii), a nonemergency service as described in 

§ 149.120(b), or an air ambulance 

service as defined in § 149.30); whether 

the service is a professional service or 

facility-based service; the State where 

the item or service was furnished; the 

claim number; the service code; and 

information to identify the location the 

item or service was furnished (including 

place of service code or bill type code); 

(6) The initial payment amount 

(including $0 if, for example, payment 

is denied); 

(7) The qualifying payment amount, if 

provided with the initial payment or 

notice of denial of payment or if the 

initiating party is a plan or issuer; 

(8) If the initiating party is a provider 

or facility, a statement that the items 

and services do not qualify for the 

notice and consent exception described 

at 45 CFR 149.410(b) or 149.420(c) 

through (i); 

(9) A statement that the provider, 

facility, or provider of air ambulance 

services was a nonparticipating 

provider, nonparticipating emergency 

facility, or nonparticipating provider of 

air ambulance services on the date the 

item or service was furnished; 

(10) Attestation that the item or 

service under dispute is a qualified IDR 

item or service, and the basis for the 

attestation; 

(11) General information listed in the 

standard notice of IDR initiation 

developed by the Secretary pursuant to 

paragraph (b)(3) of this section 

describing the Federal IDR process 

(including a description of the purpose 

of the Federal IDR process and key 

deadlines in the Federal IDR process); 

(12) A copy of the initial payment or 

notice of denial of payment or other 

remittance advice that is required to 

include the disclosures under 

§ 149.140(d)(1), with respect to the item 

or service; 

(13) Preferred certified IDR entity; and 

(14) A statement describing the key 

aspects of the claim, such as patient 

acuity or level of training of the 

provider, facility, or provider of air 

ambulance services that furnished the 

qualified IDR item or service, discussed 

by the parties during open negotiation 

that relate to the payment for the 

disputed claim, whether the reasons for 

initiating the Federal IDR process are 

different from the aspects of the claim 

discussed during the open negotiation 

period, and an explanation of why the 

party is initiating the Federal IDR 

process, including any of the 

permissible considerations described in 

§§ 149.510(c)(5)(iii) and 149.520(b)(2) 

that serve as the party’s basis for 

initiating the Federal IDR process. 

(B) [Reserved] 

(iii) Notice of IDR initiation response. 

The non-initiating party must provide to 

the initiating party and to the Secretary 

in the manner specified in paragraph 

(b)(3) of this section within 3 business 

days after the date of IDR initiation, a 

written notice and supporting 

documentation in response to the notice 

of IDR initiation, as specified in 

paragraph (b)(2)(iii)(A) of this section. 

(A) Content. The notice of IDR 

initiation response must include, with 

respect to the item or service that is the 

subject of the notice, information about 

the item or service and the parties 

including: 

(1) Information sufficient to identify 

the provider, facility, or provider of air 

ambulance services, including the name 

and current contact information 

(including the legal business name, 

email address, phone number, and 

mailing address), and the NPI; and if the 

non-initiating party is a provider, 

facility, or provider of air ambulance 

services, the TIN; 

(2) Information sufficient to identify 

the plan or issuer, including the plan’s 

or issuer’s registration number, as 

required under § 149.530 if the plan or 

issuer is registered under § 149.530 or 

an attestation from the non-initiating 

party that the plan or issuer was not 

registered prior to the date that it 

submitted the notice; the legal business 

name of the plan or issuer, as well as the 

current contact information (name, 

email address, phone number, and 

mailing address) of the plan or issuer as 

provided with the initial payment or 

notice of denial of payment; and if the 

non-initiating party is a plan or issuer, 

the plan type (for example, self-insured 

or fully-insured) and TIN (or, in the case 

of a plan that does not have a TIN, the 

TIN of the plan sponsor); 

(3) The name and contact information 

(including the legal business name, 

email address, phone number, and 

mailing address) for any third party 

representing the non-initiating party, 

and an attestation that the third party 

has the authority to act on behalf of the 

party it represents in the Federal IDR 

process; 

(4) Information sufficient to identify 

each item or service included in the 

notice of IDR initiation, including the 

date(s) the item or service was 

furnished. If the non-initiating party is 

a provider, facility, or provider of air 

ambulance services, the date(s) that the 

provider, facility, or provider of air 

ambulance services received the initial 

payment or notice of denial of payment 

for such item or service from the plan 

or issuer, and the claim number; 

(5) If the non-initiating party is a plan 

or issuer, a statement as to whether the 

non-initiating party agrees that the 

initial payment (including $0 if, for 

example, payment is denied) and the 

qualifying payment amount reflected in 

the notice of IDR initiation is accurate 

for the item or service that is the subject 

of the dispute, and if not, the initial 

payment amount (including $0 if, for 

example, payment is denied) and/or 

qualifying payment amount it believes 

to be correct, and documentation to 

support the statement (for example, the 

remittance advice confirming the 

qualifying payment amount); 

(6) If the non-initiating party is a plan 

or issuer, the amount of cost sharing 

imposed for the item or service, if any; 

(7) If the non-initiating party is a 

provider or facility, a statement that the 

items and services do not qualify for the 

notice and consent exception described 

at § 149.410(b) or § 149.420(c) through 

(i); 

(8) With respect to each item or 

service that is the subject of the dispute, 

either an attestation that the item or 

service is a qualified IDR item or 

service, or for each item or service that 

the non-initiating party asserts is not a 

qualified IDR item or service, an 

explanation and documentation to 

support the statement; 

(9) A statement confirming that the 

initial payment or notice of denial of 

payment or other remittance advice 

provided by the initiating party under 

paragraph (b)(2)(ii)(A)(12) of this section 

is accurate, and if inaccurate, a copy of 

the accurate initial payment or notice of 

denial of payment or other remittance 

advice required to include the 

disclosures under § 149.140(d)(1), with 

respect to the item or service; 

(10) A statement as to whether any of 

the information provided in the notice 

of IDR initiation is inaccurate and the 

basis for the statement as well as any 

supporting documentation; and 

(11) A statement as to whether the 

non-initiating party agrees or objects to 

the initiating party’s preferred certified 

IDR entity. If the non-initiating party 

objects to the initiating party’s preferred 


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certified IDR entity, the notice of IDR 

initiation response must include the 

name of an alternative preferred 

certified IDR entity and, if applicable, 

an explanation of any conflict of interest 

with the initiating party’s preferred 

certified IDR entity. 

(B) [Reserved]. 

(3) Manner. A party furnishing notices 

as required under paragraphs (b)(1)(ii) 

and (iii), and (b)(2)(ii) and (iii) of this 

section must furnish the notices using 

the standard forms developed by the 

Secretary and must furnish the notices 

and supporting documentation to the 

other party and the Secretary, through 

the Federal IDR portal. 

(c) * * * 

(1) Selection of certified IDR entity— 

(i) Preliminary selection of the certified 

IDR entity. Within 3 business days after 

the date of IDR initiation, the noninitiating party must agree or object to 

the preferred certified IDR entity 

identified in the notice of IDR initiation, 

as described in paragraph 

(b)(2)(iii)(A)(11) of this section. 

(A) If the non-initiating party agrees, 

or fails to object, to the selection of the 

initiating party’s preferred certified IDR 

entity in the manner described in 

paragraph (b)(2)(iii)(A)(11) of this 

section and within the timeframe 

specified in paragraph (c)(1)(i) of this 

section, the initiating party’s preferred 

certified IDR entity will be considered 

jointly selected on the third business 

day after the date of IDR initiation. 

(B) If the non-initiating party objects 

to the selection of the initiating party’s 

preferred certified IDR entity by 

designating an alternative preferred 

certified IDR entity in the manner 

described in paragraph (b)(2)(iii)(A)(11) 

of this section and within the timeframe 

specified in paragraph (c)(1)(i) of this 

section, the initiating party may then 

agree or object to the non-initiating 

party’s alternative preferred certified 

IDR entity by submitting the notice of 

certified IDR entity selection in the 

manner specified in paragraph 

(c)(1)(i)(D) of this section. If the 

initiating party agrees to the noninitiating party’s alternative preferred 

certified IDR entity within 3 business 

days after the date of IDR initiation, or 

if the non-initiating party submits the 

notice of IDR initiation response on or 

before the second business day after the 

date of IDR initiation and the initiating 

party fails to respond within 3 business 

days after the date of IDR initiation, the 

alternative preferred certified IDR entity 

will be considered jointly selected by 

the parties. If the non-initiating party 

submits the notice of IDR initiation 

response on the third business day after 

the date of IDR initiation and the 

initiating party does not agree on the 

same day, selection will proceed under 

paragraph (c)(1)(i)(C) of this section. 

(C) If a certified IDR entity is not 

jointly selected under paragraph 

(c)(1)(i)(A) or (B) of this section, either 

party may select an alternative preferred 

certified IDR entity by submitting the 

notice of certified IDR entity selection in 

the manner specified in paragraph 

(c)(1)(i)(D) of this section, until the 

earlier of the date that the parties agree 

on the alternative preferred certified IDR 

entity or the deadline for joint selection, 

which is 3 business days after the date 

of IDR initiation. Once a party submits 

a notice of certified IDR entity selection, 

it may not submit another notice of 

certified IDR entity selection until after 

it receives a responding notice of 

certified IDR entity selection from the 

other party. 

(1) If a party submits a notice of 

certified IDR entity selection to the 

other party on the first or second day 

after the date of IDR initiation and the 

party in receipt of the notice agrees or 

fails to object to the alternative preferred 

certified IDR entity by the third business 

day after the date of IDR initiation, the 

alternative preferred certified IDR entity 

will be considered jointly selected by 

the parties. 

(2) If a party submits a notice of 

certified IDR entity selection to the 

other party on the third business day 

after the date of IDR initiation and the 

party last in receipt of the notice agrees 

to the alternative preferred certified IDR 

entity on the same day, the alternative 

preferred certified IDR entity will be 

considered jointly selected by the 

parties. 

(3) If a party submits a notice of 

certified IDR entity selection to the 

other party on the third business day 

after the date of IDR initiation and the 

party last in receipt of the notice does 

not agree to the alternative preferred 

certified IDR entity on the same day, the 

parties will have failed to jointly select 

a certified IDR entity. 

(D) To notify the other party and the 

Secretary of an agreement or objection 

to an alternative preferred certified IDR 

entity under paragraph (c)(1)(i)(C) of 

this section, a party must submit the 

notice of certified IDR entity selection. 

The party must furnish the notice of 

certified IDR entity selection using the 

standard form developed by the 

Secretary and must furnish the notice to 

the other party and the Secretary 

through the Federal IDR portal within 3 

business days after the date of IDR 

initiation. However, in the event the 

conditions under paragraph (c)(1)(ii) of 

this section apply, the party may notify 

the Secretary of an agreement or 

objection to an alternative preferred 

certified IDR entity in accordance with 

paragraph (c)(1)(ii) of this section. The 

notice of certified IDR entity selection 

must include a statement indicating the 

party’s agreement with or objection to 

the other party’s alternative preferred 

certified IDR entity and, if applicable, 

an explanation of any conflict of interest 

with the alternative preferred certified 

IDR entity. If the party in receipt of a 

notice of certified IDR entity selection 

objects to the other party’s alternative 

preferred certified IDR entity and the 

party submits a notice of certified IDR 

entity selection by the end of the third 

business day after the date of IDR 

initiation, that party’s notice of certified 

IDR entity selection reflecting the 

objection must include the name of 

another alternative preferred certified 

IDR entity. 

(ii) Failure to jointly select a certified 

IDR entity. If the parties fail to jointly 

select a certified IDR entity within 3 

business days after the date of IDR 

initiation, the Secretary will select a 

certified IDR entity. The parties will 

have failed to jointly select a certified 

IDR entity if, by the end of the third 

business day after the date of IDR 

initiation, the party last in receipt of the 

notice of IDR initiation response or the 

notice of certified IDR entity selection 

has objected to the other party’s 

alternative preferred certified IDR 

entity, or if the notice of IDR initiation 

response or the notice of certified IDR 

entity selection is submitted to the other 

party on the third business day after the 

date of IDR initiation and the party in 

receipt of the notice does not agree to 

the alternative preferred certified IDR 

entity within 3 business days after the 

date of IDR initiation. 

(A) In selecting the certified IDR 

entity, the Secretary will first confirm 

whether a party submitted the notice of 

IDR initiation response or the notice of 

certified IDR entity selection with an 

alternative preferred certified IDR entity 

on the third business day after the date 

of IDR initiation without the other 

party’s agreement to the selection. If 

either notice was provided on the third 

business day after the date of IDR 

initiation without the other party’s 

agreement to the alternative preferred 

certified IDR entity by the end of third 

business day after the date of IDR 

initiation, the Secretary will provide the 

party last in receipt of the applicable 

notice 2 additional business days to 

agree or object to the other party’s 

alternative preferred certified IDR entity 

selection. 

(1) If the party last in receipt of the 

notice of IDR initiation response or the 

notice of certified IDR entity selection 


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agrees with the other party’s alternative 

preferred certified IDR entity and 

notifies the Secretary of the agreement 

or fails to notify the Secretary of its 

objection in the Federal IDR portal by 

the fifth business day after the date of 

IDR initiation, the Secretary will select 

the final alternative preferred certified 

IDR entity selected in the applicable 

notice. In disputes where the applicable 

notice was submitted on the third 

business day after the date of IDR 

initiation, the party last in receipt of the 

notice will not be allowed to select 

another alternative preferred certified 

IDR entity. 

(2) If the party notifies the Secretary 

of its objection to the alternative 

preferred certified IDR entity by the fifth 

business day after the date of IDR 

initiation, the Secretary will proceed 

with the random selection of the 

certified IDR entity from among the 

certified IDR entities (other than the 

preferred certified IDR entity and any 

alternative preferred certified IDR entity 

previously selected in such dispute by 

a party, unless there is no other certified 

IDR entity available to select) that 

charge a fee within the allowed range of 

certified IDR entity fees on the sixth 

business day after the date of IDR 

initiation. If there are insufficient 

certified IDR entities that charge a fee 

within the allowed range of certified 

IDR entity fees available to arbitrate the 

dispute, the Secretary will select a 

certified IDR entity that has received 

approval, as described in paragraph 

(e)(2)(vii)(B) of this section, to charge a 

fee outside of the allowed range of 

certified IDR entity fees. In either case, 

the Secretary will notify the parties of 

the preliminary selection of the certified 

IDR entity not later than 6 business days 

after the date of IDR initiation. 

(B) [Reserved]. 

(iii) Date of preliminary selection of 

the certified IDR entity. The date of 

preliminary selection of the certified 

IDR entity will be: 

(A) Three business days after the date 

of IDR initiation if the parties jointly 

selected a certified IDR entity, as 

specified in paragraph (c)(1)(i) of this 

section; or 

(B) Six business days after the date of 

IDR initiation, if the parties fail to 

jointly select a certified IDR entity as 

specified in paragraph (c)(1)(ii) of this 

section. 

(iv) Final selection of the certified IDR 

entity—(A) Conflict-of-interest review. 

The certified IDR entity preliminarily 

selected for a dispute must review the 

selection. The selection of the certified 

IDR entity will be finalized only if the 

certified IDR entity attests to the 

Secretary that it meets the following 

requirements: 

(1) The certified IDR entity does not 

have a conflict of interest as defined in 

paragraph (a)(2)(iv) of this section; 

(2) The certified IDR entity will only 

assign personnel to a dispute and make 

decisions regarding hiring, 

compensation, termination, promotion, 

or other similar matters related to 

personnel assigned to the dispute in a 

manner that is not based upon the 

likelihood that the assigned personnel 

will support a particular party to the 

dispute; and 

(3) The certified IDR entity will not 

assign any personnel to a dispute who 

would have any conflicts of interest, as 

defined in paragraph (a)(2)(iv) of this 

section, regarding any party to the 

dispute or whose relationship with a 

party within the 1 year immediately 

preceding the assignment to the dispute 

would violate the restrictions on aiding 

or advising a former employer or 

principal in a manner similar to the 

restrictions set forth in 18 U.S.C. 207(b). 

(B) Failure to meet conflict-of-interest 

requirements. If the certified IDR entity 

notifies the Secretary within 3 business 

days of the date of preliminary selection 

of the certified IDR entity that it does 

not meet the requirements of paragraphs 

(c)(1)(iv)(A)(1) through (3) of this 

section or if the certified IDR entity does 

not respond within 3 business days after 

the date of preliminary selection of the 

certified IDR entity, the Secretary will 

randomly select another certified IDR 

entity consistent with paragraph 

(c)(1)(ii) of this section. The Secretary 

will notify the parties of the new 

randomly preliminarily selected 

certified IDR entity no later than 1 

business day after the previously 

selected certified IDR entity notifies the 

Secretary that it has a conflict of interest 

or, if the previously selected certified 

IDR entity fails to respond within 3 

business days after the date of 

preliminary selection of the certified 

IDR entity, no later than 1 business day 

after the end of the 3-business-day 

period. 

(C) Date of final selection of the 

certified IDR entity. If the certified IDR 

entity that has been preliminarily 

selected attests within 3 business days 

that it meets the requirements of 

paragraphs (c)(1)(iv)(A)(1) through (3) of 

this section, the Secretary will notify the 

parties of final selection of the certified 

IDR entity no later than 1 business day 

after the certified IDR entity attests that 

it meets the conflict-of-interest 

requirements. The date of final selection 

of the certified IDR entity is the date 

that the Secretary provides this notice to 

the parties. 

(2) Federal IDR process eligibility 

review—(i) Federal IDR process 

eligibility determination by certified IDR 

entity. Unless the departmental 

eligibility review described in paragraph 

(c)(2)(ii) of this section applies, the 

selected certified IDR entity must 

review the information in the notice of 

IDR initiation, notice of IDR initiation 

response, and any additional 

information described in paragraph 

(c)(2)(iii) of this section, and make a 

final determination as to whether the 

item or service is a qualified IDR item 

or service, as defined in paragraph 

(a)(2)(xi) of this section, that is eligible 

for the Federal IDR process. The 

certified IDR entity must make such a 

determination and notify the Secretary 

and both parties no later than 5 business 

days after the date of final selection of 

the certified IDR entity. If the certified 

IDR entity determines that the item or 

service is not a qualified IDR item or 

service, the dispute will be closed, and 

the selected certified IDR entity will not 

take any action with regard to the 

dispute. 

(ii) Departmental eligibility review for 

Federal IDR process eligibility 

determinations. When the conditions for 

the departmental eligibility review set 

forth in paragraph (c)(2)(ii)(A) of this 

section are met, the Secretary will 

conduct the eligibility review and make 

the eligibility determination instead of 

the certified IDR entity. If the Secretary 

determines that the item or service is 

not a qualified IDR item or service, the 

dispute will be closed, and the selected 

certified IDR entity will not take any 

action with regard to the dispute. If the 

dispute is found to be eligible, the 

Secretary will inform the preliminarily 

selected certified IDR entity of the 

dispute’s eligibility so that it may 

conduct its conflict-of-interest 

assessment, and the dispute will 

otherwise continue through the Federal 

IDR process, including notification of 

the eligibility determination to the 

disputing parties by the preliminarily 

selected certified IDR entity. 

(A) Application of the departmental 

eligibility review. The departmental 

eligibility review will apply when the 

Secretary determines that any of the 

extenuating circumstances described in 

paragraph (g)(1) of this section require 

application of the departmental 

eligibility review to facilitate timely 

payment determinations or the effective 

processing of disputes under the Federal 

IDR process. 

(B) Notification regarding 

applicability of the departmental 

eligibility review. Before invoking the 

application of the departmental 

eligibility review, the Secretary will 


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post advance public notification of the 

date on which the departmental 

eligibility review will take effect and the 

reasons for invoking the application of 

the departmental eligibility review. 

Before ending the application of the 

departmental eligibility review, the 

Secretary will post advance public 

notification of the date on which the 

departmental eligibility review will no 

longer be in effect and the reasons for 

ending the application of the 

departmental eligibility review. 

(iii) Request for additional 

information. The Secretary or the 

selected certified IDR entity may request 

additional information from either party 

to a dispute at any time, including for 

the purpose of assessing whether a 

conflict of interest exists, conducting an 

eligibility determination, or making a 

payment determination. 

(A) Upon request, a party must submit 

the additional information within 5 

business days to the Secretary or the 

selected certified IDR entity, as 

applicable, through the Federal IDR 

portal. Following a request for 

additional information, the time period 

for the applicable stage of the Federal 

IDR process will be tolled until the 

earlier of the date either all of the 

requested information is provided or the 

5-business-day period expires, and each 

subsequent timeframe in the Federal 

IDR process will be determined based 

on the date of completion of the stage 

of the Federal IDR process that was 

tolled for provision of the requested 

information. 

(B) If a party fails to submit the 

additional information as required, the 

related determination, including the 

eligibility determination, conflict-ofinterest review, or payment 

determination will be made without the 

requested information unless a goodcause extension of the 5-business-day 

period, as specified in paragraph 

(g)(1)(i) of this section, has been 

provided, and the party subsequently 

submits the additional information 

requested within the extended period. 

(3) Authority to continue negotiations 

or withdraw—(i) Authority to continue 

to negotiate. If the parties to the Federal 

IDR process agree on an out-of-network 

rate for a qualified IDR item or service 

after providing the notice of IDR 

initiation to the Secretary required 

under paragraph (b)(2)(ii) of this section, 

but before the certified IDR entity has 

made its payment determination, the 

amount agreed to by the parties for the 

qualified IDR item or service will be 

treated as the out-of-network rate for the 

qualified IDR item or service. To the 

extent the amount exceeds the initial 

payment amount and any cost sharing 

paid or required to be paid by the 

participant, beneficiary, or enrollee, or 

there was an initial denial of payment, 

payment must be made directly by the 

plan or issuer to the nonparticipating 

provider, nonparticipating facility, or 

nonparticipating provider of air 

ambulance services not later than 30 

business days after the agreement is 

reached. In no instance may either party 

seek additional payment from the 

participant, beneficiary, or enrollee, 

including in instances in which the outof-network rate exceeds the qualifying 

payment amount. The initiating party 

must send a notification to the Secretary 

and to the certified IDR entity (if 

selected) electronically, through the 

Federal IDR portal, as soon as possible, 

but no later than 3 business days after 

the date of the agreement. The 

notification must include the dispute 

number, a statement of the out-ofnetwork rate for the qualified IDR item 

or service, and signatures from 

authorized signatories for both parties. 

(ii) Withdrawals. A dispute may be 

withdrawn from the Federal IDR process 

by the initiating party, the Secretary, or 

a certified IDR entity before a payment 

determination is made if one of the 

following conditions is met: 

(A) The initiating party provides 

notification through the Federal IDR 

portal to the Secretary and the certified 

IDR entity (if selected) that both parties 

to the dispute agree to withdraw the 

dispute from the Federal IDR process 

without agreement on an out-of-network 

rate. The notification must include the 

dispute number, a statement about both 

parties’ agreement to withdraw and 

signatures from authorized signatories 

for both parties. 

(B) The initiating party provides a 

standard withdrawal request notice 

through the Federal IDR portal to the 

Secretary, the certified IDR entity (if 

selected), and the non-initiating party of 

its request to withdraw the dispute from 

the Federal IDR process and the noninitiating party notifies the Secretary, 

certified IDR entity (if selected), and the 

initiating party through the Federal IDR 

portal of its agreement to withdraw from 

the Federal IDR process within 5 

business days of the initiating party’s 

request. If the non-initiating party fails 

to respond within 5 business days of the 

initiating party’s request, the noninitiating party will be considered to 

have agreed to the withdrawal, and the 

dispute will be withdrawn. 

(C) The certified IDR entity or 

Secretary cannot determine eligibility 

because both parties to the dispute are 

unresponsive to any requests for 

additional information to determine 

eligibility as described in paragraph 

(c)(2)(iii) of this section, or 

(D) The certified IDR entity cannot 

make a payment determination because 

both parties to the dispute have failed 

to submit an offer as described in 

paragraph (c)(5)(i) of this section. 

(4) * * * 

(i) In general. A certified IDR entity 

may consider up to 25 qualified IDR 

items and services jointly as part of one 

payment determination that is subject to 

the certified IDR entity fee for batched 

determinations only if the qualified IDR 

items and services meet the 

requirements of this paragraph (c)(4)(i): 

* * * * * 

(B) Payment for the qualified IDR 

items and services is required to be 

made by the same group health plan or 

health insurance issuer. For group or 

individual health insurance coverage, 

this requirement is satisfied if the same 

issuer is required to make payment for 

the qualified IDR items and services, 

even if the qualified IDR items and 

services relate to claims from different 

group health plans or individual market 

policies. For self-insured group health 

plans, this requirement is satisfied if the 

same self-insured group health plan is 

required to make payment for the 

qualified IDR items and services, 

including when the plan makes 

payments through a third party 

administrator; the requirement is not 

satisfied if multiple self-insured group 

health plans are required to make 

payments for the qualified IDR items 

and services, even if those group health 

plans make payments through the same 

third party administrator; 

(C) The qualified IDR items and 

services meet any of the following 

criteria under which multiple qualified 

IDR items and services relate to the 

treatment of a similar condition and 

therefore are permitted to be considered 

jointly as a single payment 

determination for purposes of 

encouraging efficiencies (including 

minimizing costs) in the Federal IDR 

process: 

(1) The qualified IDR items or services 

were furnished to a single patient 

during the same patient encounter. For 

purposes of this section, a single patient 

encounter is defined as a patient 

encounter on one or more consecutive 

days during which the qualified IDR 

items or services were furnished to the 

same patient and billed on the same 

claim form; or 

(2) The qualified IDR items and 

services were furnished to one or more 

patients and were billed under the same 

service code or a comparable code 

under a different procedural coding 


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system, such as Current Procedural 

Terminology (CPT) codes with 

modifiers, if applicable, Healthcare 

Common Procedure Coding System 

(HCPCS) codes with modifiers, if 

applicable, or Diagnosis-Related Group 

(DRG) codes with modifiers, if 

applicable; or 

(3) For anesthesiology, radiology, 

pathology, and laboratory qualified IDR 

items and services, the qualified IDR 

items and services were furnished to 

one or more patients and were billed 

under service codes belonging to the 

same Category I CPT code range, as 

specified in guidance published by the 

Secretary; and 

(D) All the qualified IDR items and 

services were furnished within the same 

30-business-day period following the 

date on which the first item or service 

included in the batched determination 

was furnished and were the subjects of 

a 30-business-day open negotiation 

period that ended within 4 business 

days of IDR initiation, except as 

provided in paragraph (c)(5)(vii) of this 

section. 

(ii) Treatment of bundled payment 

arrangements. Qualified IDR items and 

services that meet the definition of a 

bundled payment arrangement under 

§ 149.30 may be submitted and 

considered as a single payment 

determination, and the certified IDR 

entity must make a single payment 

determination for the multiple qualified 

IDR items and services included in the 

bundled payment arrangement. Bundled 

payment arrangements as defined in 

§ 149.30 and submitted under this 

paragraph (c)(4)(ii) are subject to the 

certified IDR entity fee for single 

determinations. 

(5) * * * 

(i) Submission of offers. Not later than 

10 business days after the date of the 

final selection of the certified IDR entity 

as described in paragraph (c)(1)(iv)(C) of 

this section (or not later than 10 

business days after the qualified IDR 

items and services are determined 

eligible as described in paragraph (c)(2) 

of this section, when the Secretary 

determines that any of the extenuating 

circumstances described in paragraph 

(g)(1)(ii) of this section apply), the plan 

or issuer and the provider, facility, or 

provider of air ambulance services: 

* * * * * 

(ii) Payment determination and 

notification. Not later than 30 business 

days after the date of the final selection 

of the certified IDR entity as described 

in paragraph (c)(1)(iv)(C) of this section 

(or not later than 30 business days after 

the qualified IDR items and services are 

determined eligible as described in 

paragraph (c)(2) of this section, when 

the Secretary determines that any of the 

extenuating circumstances described in 

paragraph (g) of this section apply), the 

certified IDR entity must: 

(A) * * * 

(1) Prevailing party. In the case of 

single determinations, the party whose 

offer is selected by the certified IDR 

entity is considered the prevailing party. 

In the case of batched determinations, 

the party with the most determinations 

in its favor is considered the prevailing 

party; if each party prevails in an equal 

number of determinations, neither party 

will be considered the prevailing party, 

and the certified IDR entity fee will be 

split evenly between the parties. 

(2) Non-prevailing party. In the case of 

single determinations, the party whose 

offer is not selected by the certified IDR 

entity is considered the non-prevailing 

party. In the case of batched 

determinations, the party with the 

fewest determinations in its favor is 

considered the non-prevailing party. 

* * * * * 

(vii) Effects of determination. 

(A) * * * 

(B) Suspension of certain subsequent 

IDR requests. In the case of a 

determination made by a certified IDR 

entity under paragraph (c)(5)(ii) of this 

section, the party that submitted the 

initial notification under paragraph 

(b)(2) of this section may not submit a 

subsequent notification involving the 

same other party with respect to a claim 

for the same item or service that was the 

subject of the initial notification during 

the 90-calendar-day period following 

the determination. 

(C) Subsequent submission of requests 

permitted. If the end of the open 

negotiation period specified in 

paragraph (b)(1) of this section occurs 

during the 90-calendar-day suspension 

period regarding claims for the same 

item or service that were the subject of 

the initial notice of IDR determination 

as described in paragraph (c)(5)(vi) of 

this section, either party may initiate the 

Federal IDR process for those claims by 

submitting a notification as specified in 

paragraph (b)(2) of this section during 

the 30-business-day period beginning on 

the day after the last day of the 90- 

calendar-day suspension period. 

* * * * * 

(d) Costs of IDR process—(1) Certified 

IDR entity fee—(i) Timing of payment of 

certified IDR entity fee. Each party to a 

dispute for which there is a final 

selection of the certified IDR entity and 

a determination that the dispute is 

eligible for the Federal IDR process in 

accordance with paragraph (c)(2) of this 

section must pay to the certified IDR 

entity the predetermined certified IDR 

entity fee charged by the certified IDR 

entity. The certified IDR entity fee must 

be paid no later than the date a party 

submits its offer to the certified IDR 

entity, in accordance with paragraph 

(c)(5)(i) of this section. 

(ii) Failure to timely pay certified IDR 

entity fee. If a party fails to pay the 

certified IDR entity fee as specified in 

paragraph (d)(1)(i) of this section, that 

party’s offer will not be considered 

received. Such party will continue to be 

responsible for payment of the certified 

IDR entity fee. 

(iii) Method of allocation of the 

certified IDR entity fee after a payment 

determination. After making a payment 

determination, the certified IDR entity 

shall retain the certified IDR entity fee 

described under paragraph (d)(1)(i) of 

this section paid by the non-prevailing 

party as defined in paragraph 

(c)(5)(ii)(A)(2) of this section. The 

certified IDR entity must return the fee 

paid by the prevailing party, as defined 

in paragraph (c)(5)(ii)(A)(1) of this 

section, within 30 business days 

following the date of the certified IDR 

entity’s payment determination. In the 

event of a batched dispute in which 

each party prevails in an equal number 

of determinations, the certified IDR 

entity fee will be split evenly between 

the parties. In that case, the certified 

IDR entity must return half the fee paid 

by each party within 30 business days 

following the date of the certified IDR 

entity’s payment determination. 

(iv) Method of allocation of the 

certified IDR entity fee upon agreement 

or withdrawal after an eligibility 

determination. For a dispute for which 

there is a final selection of the certified 

IDR entity and a determination that the 

dispute is eligible for the Federal IDR 

process in accordance with paragraph 

(c)(2) of this section, unless directed 

otherwise by both parties, the certified 

IDR entity is required to return half of 

each party’s certified IDR entity fee 

within 30 business days of the date both 

parties notify the certified IDR entity 

that they have: 

(A) Reached an agreement on an outof-network rate for qualified IDR items 

or services before the certified IDR 

entity has made its payment 

determination, as described in 

paragraph (c)(3)(i) of this section; or 

(B) Withdrawn the dispute before the 

certified IDR entity has made its 

payment determination, as described in 

paragraph (c)(3)(ii) of this section. 

(v) Method of allocation of the 

certified IDR entity fee upon agreement 

or withdrawal before an eligibility 

determination. When the parties reach 

an agreement on an out-of-network rate 


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or withdraw a dispute for which there 

is a final selection of the certified IDR 

entity, but for which no eligibility 

determination has yet been made, 

unless directed otherwise by both 

parties, the certified IDR entity is 

required to return each party’s full 

certified IDR entity fee within 30 

business days of the date both parties 

notify the certified IDR entity that they 

have agreed on an out-of-network rate or 

agreed to withdraw the dispute. 

(2) Administrative fee. (i) In general. 

Each party to a dispute for which a 

certified IDR entity is selected under 

paragraph (c)(1) of this section must pay 

a non-refundable administrative fee to 

the Secretary for participating in the 

Federal IDR process. 

(A) Timing of payment of 

administrative fee. The initiating party 

must pay the administrative fee within 

2 business days of the date of 

preliminary selection of the certified 

IDR entity as described in paragraph 

(c)(1)(iii) of this section. The noninitiating party must pay the 

administrative fee within 2 business 

days of the date the non-initiating party 

receives notice that an eligibility 

determination for the Federal IDR 

process has been reached by either the 

certified IDR entity or the Departments 

in accordance with paragraph (c)(2) of 

this section. 

(B) Agreements and withdrawals. In 

the case of an agreement, as described 

in paragraph (c)(3)(i) of this section, or 

a withdrawal, as described in paragraph 

(c)(3)(ii) of this section, the 

administrative fee will not be returned 

to the parties if preliminary selection of 

the certified IDR entity has occurred, as 

described in paragraph (c)(1)(i) of this 

section; if not yet collected, the 

administrative fee must still be paid, 

except as provided in paragraph 

(d)(2)(i)(C) of this section for a dispute 

closed for nonpayment by an initiating 

party. 

(C) Failure to pay administrative fee. 

If the initiating party fails to pay the 

administrative fee in accordance with 

paragraph (d)(2)(i)(A) of this section, the 

dispute will be closed due to 

nonpayment and neither party will be 

responsible for the administrative fee. If 

the non-initiating party fails to pay the 

administrative fee in accordance with 

paragraph (d)(2)(i)(A) of this section, 

that party’s offer will not be considered 

received and the non-initiating party 

will continue to be responsible for 

payment of the administrative fee. 

(D) Collection of unpaid fees. Any 

party that fails to pay the administrative 

fee owed in accordance with paragraph 

(d)(2)(i)(A) of this section is obligated to 

pay the administrative fee otherwise 

due and owing, except as provided in 

paragraph (d)(2)(i)(C) of this section for 

a dispute closed for nonpayment by an 

initiating party. The Secretary will 

pursue collection from a party to a 

dispute of any administrative fee that is 

not timely paid pursuant to applicable 

debt collection authorities, after netting 

any amounts owed by the Federal 

Government in accordance with 

§ 156.1215 of this Title, as applicable. 

(ii) Administrative fee amount. The 

administrative fee amount and method 

of payment will be established through 

notice and comment rulemaking in a 

manner such that the total 

administrative fees paid for a year, 

including administrative fees reduced 

under paragraph (d)(2)(iii) of this 

section, are estimated to be equal to the 

projected amount of expenditures made 

by the Secretaries of the Treasury, 

Labor, and Health and Human Services 

for the year in carrying out the Federal 

IDR process. 

(A) For disputes initiated on or after 

the later of the effective date of Federal 

Independent Dispute Resolution (IDR) 

Process Administrative Fee and 

Certified IDR Entity Fee Ranges final 

rules or January 1, 2024, the 

administrative fee amount is $150 per 

party per dispute, which will remain in 

effect until changed by subsequent 

rulemaking. 

(B) [Reserved] 

(iii) Reducing the administrative fee 

amount. For disputes initiated on or 

after January 1, 2025— 

(A) The Secretary may reduce the 

administrative fee for both parties in 

accordance with paragraph (d)(2)(iii)(C) 

of this section when the highest offer 

made by either party during open 

negotiation for the dispute is less than 

the threshold established in notice and 

comment rulemaking pursuant to 

paragraph (d)(2)(ii) of this section. For a 

dispute that satisfies the requirements 

for a reduced administrative fee in 

accordance with this paragraph and for 

which a determination has been made 

that the dispute is eligible for the 

Federal IDR process in accordance with 

paragraph (c)(2) of this section, the 

administrative fee amount may be 

reduced to 50 percent of the 

administrative fee amount as described 

in paragraph (d)(2)(ii) of this section for 

each party to the dispute. For a dispute 

that satisfies the requirements for a 

reduced administrative fee in 

accordance with this paragraph and for 

which a determination has been made 

that the dispute is ineligible for the 

Federal IDR process in accordance with 

paragraph (c)(2) of this section, the 

administrative fee amount may be 

reduced to 50 percent of the 

administrative fee amount as described 

in paragraph (d)(2)(ii) of this section for 

the initiating party and to 20 percent of 

the administrative fee amount for the 

non-initiating party. 

(B) The Secretary may reduce the 

administrative fee for a non-initiating 

party in accordance with paragraph 

(d)(2)(iii)(C) of this section when the 

dispute is determined to be ineligible 

for the Federal IDR process in 

accordance with paragraph (c)(2) of this 

section. For a dispute that satisfies the 

requirements for a reduced 

administrative fee in accordance with 

this paragraph, the administrative fee 

amount for the non-initiating party may 

be reduced to 20 percent of the 

administrative fee amount as described 

in paragraph (d)(2)(ii) of this section. 

(C) The reduced administrative fee 

amounts provided for in paragraphs 

(d)(2)(iii)(A) and (d)(2)(iii)(B) of this 

section shall be established in notice 

and comment rulemaking and will 

remain in effect until changed by 

subsequent rulemaking, pursuant to 

paragraph (d)(2)(ii) of this section. 

(e) * * * 

(2) * * * 

(vi) Meet appropriate indicators of 

fiscal integrity and stability by 

demonstrating that the certified IDR 

entity has a system of safeguards and 

controls in place to prevent and detect 

improper financial activities by its 

employees and agents to assure fiscal 

integrity and accountability for all 

certified IDR entity fees and 

administrative fees (if applicable) 

received, held, and disbursed and by 

submitting 3 years of financial 

statements or, if not available, other 

information to demonstrate fiscal 

stability of the certified IDR entity; 

* * * * * 

(viii) Have a procedure in place to 

retain the certified IDR entity fees 

described in paragraph (d)(1) of this 

section paid by both parties in a trust or 

escrow account and to return the 

certified IDR entity fee paid by the 

prevailing party or a portion of each 

party’s certified IDR entity fee in the 

case of an agreement described in 

paragraph (c)(3)(i) of this section, a 

withdrawal described in paragraph 

(c)(3)(ii) of this section, or a 

circumstance described under 

paragraph (d)(1)(iii) of this section, 

within 30 business days following the 

date of the determination; 

(ix) Have a procedure in place to 

retain the administrative fees (if 

applicable) described in paragraph 

(d)(2) of this section and to remit the 

administrative fees to the Secretary in 

accordance with the timeframe and 


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75886 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

procedures set forth in guidance 

published by the Secretary; 

* * * * * 

(g) * * * 

(1) In general. The time periods 

specified in this section (other than the 

time for payment, if applicable, under 

paragraph (c)(5)(ix) of this section) may 

be extended in extenuating 

circumstances at the Secretary’s 

discretion. Extenuating circumstances 

include, but are not limited to when: 

(i) With respect to a specific dispute, 

the Secretary determines that the parties 

or certified IDR entity cannot meet 

applicable timeframes due to matters 

beyond the control of one or both 

parties or the certified IDR entity, or for 

other good cause. The certified IDR 

entity or either party may also submit a 

request for an extension due to 

extenuating circumstances to the 

Secretary through the Federal IDR 

portal. The requesting certified IDR 

entity or party must attest that it will 

take prompt action to ensure that the 

certified IDR entity’s payment 

determination under this section may be 

made as soon as administratively 

practicable under the circumstances; or 

(ii) The Secretary determines that the 

parties or certified IDR entity cannot 

meet applicable timeframes due to 

systematic delays in processing disputes 

under the Federal IDR process, such as 

an unforeseen volume of disputes or 

Federal IDR portal system failures. 

Extensions provided due to extenuating 

circumstances caused by an unforeseen 

volume of disputes will be applied to 

the timeframe for eligibility 

determinations under paragraph (c)(2) of 

this section. Extensions provided due to 

extenuating circumstances caused by 

systems failures within the Federal IDR 

portal will be applied to the Federal IDR 

process timeframe(s) determined 

relevant by the Secretary. The Secretary 

will post a public notice regarding any 

extensions of time periods pursuant to 

this paragraph (g)(1)(ii). 

(A) Timeframe following an extension 

to eligibility determination. When an 

extension to the eligibility 

determination timeframe pursuant to 

paragraph (g)(1)(ii) of this section is in 

effect, the start date of the subsequent 

timeframes in the Federal IDR process 

will be determined based on the date of 

completion of the eligibility 

determination by the certified IDR entity 

or the Secretary. 

(1) Submission of offers. The parties 

must submit their offers and certified 

IDR entity fees to the certified IDR entity 

not later than 10 business days after the 

qualified IDR items and services are 

determined eligible as described in 

paragraph (c)(2) of this section. 

(2) Payment Determination. The 

certified IDR entity must make the 

payment determination and notification 

of the payment determination to the 

parties not later than 30 business days 

after the qualified IDR items and 

services are determined eligible as 

described in paragraph (c)(2) of this 

section. 

(B) Timeframe following an extension 

to other timeframes in the Federal IDR 

process. When an extension to any 

timeframe within the Federal IDR 

process, other than the eligibility 

timeframe, is in effect pursuant to 

paragraph (g)(1)(ii) of this section, the 

start date of each subsequent timeframe 

in the Federal IDR process will be 

determined based on the date of 

completion of the process for which the 

extension was granted. 

(2) [Reserved] 

(h) Applicability date. (1) Paragraph 

(a) of this section is applicable with 

respect to plan years (or in the 

individual market, policy years) 

beginning on or after January 1, 2022, 

except that the provisions regarding IDR 

entity certification at paragraphs (a) and 

(e) of this section are applicable 

beginning on October 7, 2021, and the 

revised definition for batched qualified 

IDR items and services at paragraph 

(a)(2)(i) of this section is applicable to 

disputes with open negotiation periods 

beginning on or after the later of August 

15, 2024, or 90 days after the effective 

date of the rule. 

(2) Paragraph (b) of this section is 

applicable to disputes with open 

negotiation periods beginning on or 

after the later of August 15, 2024, or 90 

days after the effective date of the rule. 

(3) Paragraph (c)(1) of this section, 

regarding the selection of a certified IDR 

entity, is applicable to disputes with 

open negotiation periods beginning on 

or after the later of August 15, 2024, or 

90 days after the effective date of the 

rule, except that paragraphs 

(c)(1)(iv)(A)(1) through (3) of this 

section, regarding the conflict-of-interest 

standards, are applicable with respect to 

plan years (or in the individual market, 

policy years) beginning on or after 

January 1, 2022. 

(4) Paragraph (c)(2) of this section, 

regarding the Federal IDR process 

eligibility review and paragraph (c)(3) of 

this section regarding the authority to 

continue negotiations or withdraw are 

applicable to disputes with open 

negotiation periods beginning on or 

after the later of August 15, 2024, or 90 

days after the effective date of the rule 

and paragraph (c)(4) of this section 

regarding the treatment of batched and 

bundled qualified IDR items and 

services is applicable 90 days after the 

effective date of the rule. 

(5) Paragraphs (c)(5)(i) and (ii), and 

(c)(5)(vii)(B) and (C) of this section 

regarding the deadlines for the 

submission of offers, payment 

determination and notification, 

suspension of certain subsequent IDR 

requests, and subsequent submission of 

requests submitted are applicable to 

disputes with open negotiation periods 

beginning on or after the later of August 

15, 2024, or 90 days after the effective 

date of the rule. Paragraphs (c)(5)(iii) 

and (iv) of this section regarding 

considerations in payment 

determinations and the related 

examples and paragraph (c)(5)(vi)(B) of 

this section regarding written decisions 

are applicable with respect to items or 

services furnished on or after October 

25, 2022, for plan years (or in the 

individual market policy years) 

beginning on or after January 1, 2022. 

Paragraphs (c)(5)(v) through 

(c)(5)(vi)(A), (c)(5)(vii)(A), and 

(c)(5)(viii) and (ix) are applicable with 

respect to plan years (or in the 

individual market, policy years) 

beginning on or after January 1, 2022. 

(6) Paragraph (d) of this section 

regarding the costs of the IDR process is 

applicable to disputes initiated on or 

after January 1, 2025. 

(7) Paragraph (e) of this section is 

applicable with respect to plan years (or 

in the individual market, policy years) 

beginning on or after January 1, 2022, 

except that the provisions regarding IDR 

entity certification at paragraphs (e)(1), 

(e)(2)(i) through (vi), (e)(2)(x) and (xi), 

and (e)(3) through (6) of this section are 

applicable beginning on October 7, 

2021. Paragraphs (e)(2)(vi), (viii), and 

(ix) of this section regarding the 

certified IDR entity’s controls to prevent 

and detect improper financial activities, 

and procedures to retain the certified 

IDR entity fee and administrative fee are 

applicable upon the effective date of the 

rule. 

(8) Paragraph (f) of this section is 

applicable with respect to plan years (or 

in the individual market, policy years) 

beginning on or after January 1, 2022, 

except that paragraph (f)(1)(v)(F) of this 

section regarding reporting of 

information relating to the Federal IDR 

process is applicable with respect to 

items or services furnished on or after 

October 25, 2022, for plan years (or in 

the individual market policy years) 

beginning on or after January 1, 2022. 

(9) Paragraph (g) of this section 

regarding the extension of time periods 

for extenuating circumstances is 

applicable to disputes with open 

negotiation periods beginning on or 


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Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 75887 

after the later of August 15, 2024, or 90 

days after the effective date of the rule. 

(10) Until the relevant applicability 

date for the requirements of this section, 

plans, issuers, providers, facilities, 

providers of air ambulance services and 

certified IDR entities are required to 

continue to comply with the 

corresponding section of § 149.510 in 

effect on October 25, 2022. 

(i) Severability. (1) Any provision of 

this section held to be invalid or 

unenforceable by its terms, or as applied 

to any person or circumstance, shall be 

construed so as to continue to give 

maximum effect to the provision 

permitted by law, unless such holding 

shall be one of utter invalidity or 

unenforceability, in which event the 

provision shall be severable from this 

section and shall not affect the 

remainder thereof or the application of 

the provision to persons not similarly 

situated or to dissimilar circumstances. 

(2) The provisions of paragraphs 

(b)(1), (c)(2)(ii), (c)(4), (d)(2), and (g)(1) 

of this section are intended to be 

severable from one another, from any 

grant of forbearance from removal 

resulting from this subpart, and from 

any provision referenced in those 

paragraphs. The provisions in § 149.510 

are intended to be severable from the 

provisions in §§ 149.100, 149.140, and 

149.530, from any grant of forbearance 

from removal resulting from this 

subpart, and from any provision 

referenced in §§ 149.100, 149.140, and 

149.530. 

■ 23. Section 149.530 is added to 

subpart F to read as follows: 

§ 149.530 Federal independent dispute 

resolution registry of group health plans, 

health insurance issuers, and Federal 

Employees Health Benefits Carriers. 

(a) Establishment of Federal 

independent dispute resolution registry. 

The Secretary, jointly with the Secretary 

of the Treasury and the Secretary of 

Labor, will establish a Federal IDR 

registry consisting of the information 

described in paragraph (b)(2) of this 

section and will assign a registration 

number for each group health plan, 

health insurance issuer offering group or 

individual health insurance coverage, 

and Federal Employees Health Benefits 

(FEHB) Program carrier. The 

information contained in the registry 

will be made available to parties seeking 

to initiate an open negotiation or a 

dispute through the Federal IDR portal, 

and will be searchable, including by 

registration number. 

(b) Federal IDR registration—(1) 

Registration requirement. Each group 

health plan and health insurance issuer 

offering group or individual health 

insurance coverage subject to the 

Federal IDR process must register with 

the Federal IDR registry as specified by 

the Secretary in guidance. Initial 

registration must be completed by the 

later of the date that is 30 business days 

after the effective date of the final rule, 

the date that is 30 business days after 

the registry becomes available, or the 

date the group health plan or health 

insurance issuer begins offering a group 

health plan or individual health 

insurance coverage subject to the 

Federal IDR process. 

(2) Required data elements. Group 

health plans and health insurance 

issuers offering group or individual 

health insurance coverage subject to the 

registration requirement must include 

the following information with their 

registration: 

(i) The legal business name (if any) of 

the group health plan, issuer, or FEHB 

carrier and, if applicable, the legal 

business name of the group health plan 

sponsor; 

(ii) Whether the plan or coverage is a 

self- or fully-insured group health plan 

subject to ERISA, individual health 

insurance coverage, a plan offered by a 

FEHB carrier, a self- or fully-insured 

non-Federal governmental plan, or a 

self- or fully-insured church plan; 

(iii) The State(s) in which the plan or 

coverage is subject to a specified State 

law, as defined in § 149.30 for any items 

or services for which the protections of 

§§ 149.110, 149.120, and 149.130 apply; 

(iv) The State(s) in which the plan or 

coverage is subject to an All-Payer 

Model Agreement under section 1115A 

of the Social Security Act for any items 

or services to which the protections in 

§§ 149.110, 149.120, and 149.130, apply; 

(v) For self-insured group health plans 

not otherwise subject to State law, any 

State(s) in which the group health plan 

has properly effectuated an election to 

opt in to a specified State law as defined 

in § 149.30, if that State allows a plan 

not otherwise subject to the State law to 

opt-in; and for FEHB plans that adopt a 

specified State law pursuant to their 

FEHB carrier’s contract terms, any 

State(s) in which they have made such 

an adoption; 

(vi) Contact information, including a 

telephone number and email address, 

for the appropriate person or office to 

initiate open negotiations for purposes 

of determining an amount of payment 

(including cost sharing) for such item or 

service; 

(vii) The 14-digit Health Insurance 

Oversight System (HIOS) identifier; or if 

the 14-digit HIOS identifier has not been 

assigned, the 5-digit HIOS identifier; or 

if no HIOS identifier is available, the 

plan’s or the plan sponsor’s Employer 

Identification Number (EIN) and the 

plan’s plan number (PN), if a PN is 

available, or for FEHB carriers, the 

applicable contract number(s) and plan 

code(s); 

(viii) Additional information needed 

to identify the plan or issuer and the 

applicable Federal and State 

requirements for determining 

appropriate out-of-network payment 

rates for items or services to which the 

protections against balance billing in 

this part apply, as specified by the 

Secretary in guidance, or such 

additional information needed with 

respect to FEHB carriers as specified by 

OPM in guidance; and 

(ix) Additional information needed 

for purposes of administrative fee 

collection, as specified by the Secretary 

in guidance, or such additional 

information needed with respect to 

FEHB carriers as specified by OPM in 

guidance. 

(3) Updating disclosures. A plan or 

issuer must timely report to the 

Secretary changes to the information 

required under this section within 30 

calendar days after the information 

changes. A plan or issuer must confirm 

the accuracy of its registration annually 

in the fourth quarter of each calendar 

year. 

(4) Third party authority. The 

requirements of paragraphs (b)(1) 

through (3) of this section may be 

performed by a third party administrator 

or service provider with authority to act 

on behalf of the group health plan or 

health insurance issuer offering group or 

individual health insurance coverage 

subject to the Federal IDR process. If the 

registration requirements are performed 

by such third party administrator or 

service provider the group health plan 

or health insurance issuer offering group 

or individual health insurance coverage 

must require that such third party 

administrator or service provider clearly 

delineate each group health plan or 

health insurance issuer offering group 

health insurance coverage for which it 

has authority to act. If such third party 

administrator or service provider fails to 

provide the information in compliance 

with the requirements of paragraphs 

(b)(1) through (3) of this section the plan 

or issuer will be in violation of the 

requirements of this section. 

(c) Severability. (1) Any provision of 

this section held to be invalid or 

unenforceable by its terms, or as applied 

to any person or circumstance, shall be 

construed so as to continue to give 

maximum effect to the provision 

permitted by law, unless such holding 

shall be one of utter invalidity or 

unenforceability, in which event the 

provision shall be severable from this 


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75888 Federal Register / Vol. 88, No. 212 / Friday, November 3, 2023 / Proposed Rules 

section and shall not affect the 

remainder thereof or the application of 

the provision to persons not similarly 

situated or to dissimilar circumstances. 

(2) The provisions in § 149.530 are 

intended to be severable from the 

provisions in §§ 149.100, 149.140, and 

149.510, from any grant of forbearance 

from removal resulting from this 

subpart, and from any provision 

referenced in §§ 149.100, 149.140, and 

149.510. 

[FR Doc. 2023–23716 Filed 10–27–23; 4:15 pm] 

BILLING CODE 6325–63–P; 4830–01–P; 4510–29–P; 

4120–01–P] 


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