No Surprises Act: Federal court recognizes private right of action to enforce IDR awards

On May 14, 2025, the Chief Judge of the District of Connecticut issued a long-awaited opinion in a case filed by several air ambulance companies seeking to enforce unpaid and late-paid Independent Dispute Resolution (IDR) awards in federal court under the No Surprises Act (NSA). Guardian Flight II: Guardian Flight et al. v. Aetna et al., Case No. 3:24-cv-00680-MPS (D. Conn.).

Significantly, this decision marks the first time a federal court has recognized an implied private right of action under the NSA to enforce IDR awards as well as an enforcement right under the Employee Retirement Income Security Act (ERISA). Consequently, healthcare providers can now access civil remedies under ERISA, including potential recovery of lawyer’s fees. Moreover, this decision opens the door to additional damages under state law, such as punitive damages, for untimely payment of IDR awards.

Background

Congress enacted the NSA in 2020 to protect patients from surprise medical bills in situations where they have no choice over whether their provider is in-network and to establish a process for resolving payment disputes between insurers and out-of-network providers. The statute’s IDR process utilizes the services of third party federal contractors who make payment determinations. Each side submits a payment offer alongside evidence and argument on why its offer is the appropriate reimbursement amount. The IDR entity assigned the dispute must select one of two offers as the payment rate for that particular claim. If the provider prevails, the additional payment required by the award must be made within 30 days.

Payment disputes are initiated, and all filings are made, through a website operated by the Centers for Medicare and Medicaid Services (CMS) which has experienced significant backlogs due to high dispute volumes since its launch in 2022. It was not long after IDR awards began to issue that the question of enforcement arose. Providers quickly complained of insurers not paying awards or paying them long after their deadline to do so without any additional compensation.

Guardian Flight I

The District of New Jersey was one of the first courts to tackle the enforcement question. In GPS of N.J. v. Horizon, 2023 U.S. Dist. LEXIS 159460 (D.N.J. Sept. 8, 2023), a provider sought to vacate an IDR award under Section 10 of the Federal Arbitration Act (FAA), a portion of which is referenced in the NSA. The insurer responded with a cross-motion to confirm the award under Section 9 of the FAA. The court denied vacatur but concluded it had the authority and power to enforce the IDR award.

Next, the Northern District of Texas waded into the NSA waters in Guardian Flight et al. v. HCSC, 742 F. Supp. 3d 742 (N.D. Tex. 2024) (Guardian Flight I), concluding that providers lacked any ability under the NSA, FAA or ERISA to enforce their IDR awards, a decision that was appealed to the Fifth Circuit, which held argument on it in February 2025. Notably, the United States government filed an amicus brief in support of the providers, asserting that IDR awards are enforceable under both the NSA and ERISA.

Guardian Flight II

The District of Connecticut rejected the rulings in Guardian Flight I, concluding instead that the NSA implies a private right of action that allows providers to enforce IDR awards against insurers and health plans. The court noted that the NSA contains “strong, mandatory language regarding health plans’ and insurers’ payment obligations and the ‘binding’ effect of IDR awards.” It concluded that Congress intended the judiciary to play a role in ensuring IDR awards were enforced, noting that any other interpretation “would render IDR awards meaningless.”

Citing Fifth Circuit precedent, the court next ruled that providers with assignments of their patients’ rights under ERISA may enforce IDR awards as an ERISA claim for health plan benefits. In particular, the court noted that a plaintiff may sue to enforce the benefit of its bargain regardless of whether it alleges any personal financial loss. Accordingly, a patient’s assignee such as a healthcare provider likewise can sue to enforce the bargain.

Finally, the court held that a provider may sue under Connecticut unfair trade practices law for systemic failures to timely pay IDR awards. It rejected the insurers’ arguments that such a claim is preempted by either ERISA or the NSA itself. Instead, the court concluded that “[i]mposing state law penalties for [insurers’] failure to timely pay IDR awards would not create any obstacles to the NSA’s purposes and objectives, as untimely payments are already proscribed by the NSA.”