WASHINGTON – The ERISA Industry Committee (ERIC) today released a new white paper, Employer Exposure Under the No Surprises Act, finding that the costs of the federal arbitration process created under the No Surprises Act (NSA) have grown exponentially past what Congress and federal forecasters projected, with self-funded employers, not insurance companies, paying the resulting costs.
“Employers are shouldering these unintended, unsustainable costs, and we are shouting from the rooftops about the need to fix this system,” said James Gelfand, President and CEO of ERIC. “Our member companies work tirelessly to be good stewards of employees’ health care dollars and protect them from unnecessary costs. An arbitration process with no basis on real prices, no brakes, and no way to appeal is making that job impossible. This report gives Congress the opportunity to hear directly from the employers funding this system, not just the industries profiting from it.”
Based in part on confidential interviews with large self-funded employer plan sponsors, the report shows that Independent Dispute Resolution (IDR) awards are no longer a marginal backstop for rare billing disputes. Instead, employers described the process as an increasingly costly and opaque line item in their health plan budgets, one they often cannot predict, audit, or control.
The report highlights several findings from confidential employer interviews:
- One large self-funded employer saw IDR-related payments rise from approximately $3.5 million in 2025 to more than $6 million in the first half of 2026 alone, putting it on pace to exceed $12 million for the year.
- Another employer estimated that IDR awards are adding 1 to 3 percent to the annual health care trend.
- A third employer projected that IDR payouts alone could consume 5 to 6 percent of total 2026 health care spending.
- Employers reported that IDR outcomes can be difficult to forecast, and impossible to mitigate, with one sponsor describing arbitration decisions as “functionally random.”
- Several employers said they lack full visibility into which providers are driving IDR exposure, how disputes are being handled by third-party administrators, and whether plan assets are being protected effectively.
The report also shows that employer interview findings align with wider national data showing rapid growth in IDR dispute volume, high provider win rates, and arbitration awards that routinely exceed market-based payment benchmarks – creating a severe perverse incentive for providers to choose to stay out of network.
ERIC has engaged with federal regulators and Congress on this for over a year, joining a coalition of more than sixty employer, labor, and consumer groups in February 2026 to demand tighter arbitrator oversight, then joining 47 other organizations in May 2026 to call for a federal investigation into high-volume filers gaming the system.
The new report continues that advocacy by demanding a concrete fix: restore meaningful market-based cost controls, improve transparency into IDR filings and outcomes, strengthen oversight of certified IDR entities, and ensure employers have the information they need to fulfill their fiduciary obligations and manage plan spending responsibly.
Read the full report here.