Why One in Five Disputes Never Reaches a Decision

What "ineligible" means, and what it costs

A dispute found ineligible is not a dispute you lost. It is a dispute nobody read. The certified IDR entity never weighed your offer against the plan's, never looked at your documentation, and never formed a view on what the service was worth. The administrative fee is spent, the deadline has usually passed, and the claim is generally gone.

The scale of this is easy to miss because it improved dramatically. In the first half of 2023, 69% of disputes were being found ineligible. By 2024 that had fallen to about 19%. That is an enormous improvement, driven by filers learning the rules and by the Departments clarifying them — and 19% is still roughly one dispute in five.

Expect the challenge. In the last six months of 2025 non-initiating parties challenged the eligibility of 42% of initiated disputes — 574,128 of 1,372,563 — and roughly 19% of disputes were ultimately found ineligible. A contested eligibility review is closer to the norm than the exception, so the filing has to survive one by construction rather than by luck.

The five things eligibility actually turns on

1. Federal process or state process

This is the most consequential fork and the easiest to get wrong. CMS flags states that have a specified state law or an All-Payer Model Agreement applying to certain out-of-network payment disputes — 22 of the states and territories in its Table 7. In those states, some disputes belong in the state process and some in the federal one, and which is which depends on the plan, not on the claim.

The practical test is usually whether the patient's plan is self-funded. ERISA preempts state insurance regulation of self-funded employer plans, so a state law generally cannot reach them — those disputes go federal even in a state that runs its own arbitration. Self-funded and partly self-funded plans accounted for 320,845 of the 478,849 disputes initiated in the fourth quarter of 2024, so this is the common case rather than the exception. Which states carry a specified state law is here.

2. Whether the item or service is covered at all

The No Surprises Act covers emergency services, air ambulance transport, and non-emergency services delivered by out-of-network providers at in-network facilities. Ancillary services at an in-network facility — anaesthesia, radiology, pathology, neonatology, assistant surgeons, and services with no in-network provider available — are covered and cannot be waived by consent. Ground ambulance is deliberately outside the federal process, which catches operators who run both ground and air.

Where non-emergency care was delivered and a valid notice-and-consent was obtained, the claim falls outside the protections. The requirements for that notice are specific enough that many attempts do not meet them — and where the notice was defective, the claim is back inside the protections and eligible.

3. Open negotiation, run properly

Federal IDR cannot be initiated until a 30-business-day open negotiation period has run. Business days, not calendar days — roughly six weeks. The period starts with a written notice of open negotiation to the other party, and the clock runs from the initial payment or the notice of denial.

Then the window, and read this one twice: the regulation gives you a 4-business-day period beginning on the 31st business day after the START of the open negotiation period (45 CFR 149.510(b)(2)). Not four days from when you finished negotiating, and not four weeks. If the negotiation notice went out late, or nobody logged the date it went out, the window can close before anyone notices — nothing goes wrong until you try to file.

4. Batching that meets the requirements

The No Surprises Act sets four conditions for items and services to be considered jointly as a single determination. All four have to hold:

• They were billed by the same provider, group of providers, facility or air ambulance provider — that is, under the same NPI or TIN.
• Payment for them would be made by the same plan or issuer.
• They are the same or similar items and services.
• They were all furnished within the same 30-business-day period, or their open negotiation periods end within the 90-calendar-day cooling-off period.

The third condition carries a wrinkle worth knowing. The criterion itself is statutory and applies. What the Eastern District of Texas vacated in TMA IV was the regulatory definition of it — the October 2021 rule that treated items as same or similar only when billed under the same service code with modifiers, or a comparable code in another coding system. So the requirement stands while its precise boundary is less settled than older write-ups suggest, and the Departments revisited batching again in the 2026 rules.

Batching claims that do not qualify together gets the whole batch questioned rather than just the offending line. Because batching is what makes small claims economic, the temptation to over-batch is real — and it is a good way to convert a marginal filing into a wasted one. How the batching arithmetic works, and where it stops working.

5. The 2026 rule changed the mechanics

Under the Federal IDR Operations final rules, open negotiation now runs through the federal portal rather than by private correspondence, with a defined response deadline, and eligibility determinations are made on a compressed timetable. If the process you learned in 2023 is the process you are still running, some of what you know is stale. What changed and when each piece takes effect.

What this means for how you should file

The instinct is to file everything and let the process sort it out. The federal data argues the opposite. A dispute that fails eligibility costs the fee and the claim; a dispute that never gets filed costs only the claim. Screening first is not caution, it is arithmetic.

It also reorders what matters. A practice that improves its documentation improves its odds inside the 85% of determinations that go to providers. A practice that fixes its eligibility screening changes whether it gets into that population at all — and the second is worth more, because one in five filings is currently not getting there.

Where we fit

Eligibility screening is the first thing we do and the reason we sometimes tell a practice not to file. That is not a sales position, it is the same arithmetic: our fee comes out of recoveries, so a dispute that dies on eligibility costs us the work and costs you the claim. Our terms, and the federal fees, are set out here.

What an Ineligible Dispute Costs in Fees — and Who Pays What

Eligibility failures are usually discussed in terms of the claim you lose. There is also a fee mechanics behind every filing, and it is worth understanding before you initiate, because the two fees in this process behave very differently.

The administrative fee is paid by each party for each dispute, and it is nonrefundable regardless of outcome. For disputes initiated on or after June 11, 2026, it is $15 per side; before that date it was $115. (An earlier guidance document set it at $350 per side, and a federal court vacated that fee in August 2023 — see the litigation section below.) If your dispute is found ineligible, this fee is simply spent, and the process never reached the merits.

The certified IDR entity's fee is the larger number. It falls within a range the Departments publish each year, it is set differently for single and batched determinations, and — the part that matters for filing arithmetic — it is paid by the losing party. A filer whose dispute reaches a determination and prevails pays the administrative fee and nothing to the entity. A filer whose dispute dies on eligibility pays the administrative fee and recovers nothing on the claim. That asymmetry is the financial case for screening before initiating rather than after.

The scale of this money is public, and it puts the two fees in proportion. In the second half of 2024 alone:

Entity fees ran 3.6 times the administrative fees in a single half-year. The entity fee — the one the losing side pays — is the dominant financial stake in the process, not the administrative fee. This is also why an ineligible filing is the most expensive kind of failure: it incurs a fee, consumes the initiation window, and never puts the entity fee in play on your side of the table.

None of this is an estimate of what any particular practice will pay or recover; the fee ranges are published annually by the Departments and change.

Plan Type Is Where Eligibility Lives — and in 13.5% of Filings, the Issuer Never Responded

Whether a dispute belongs in the federal process often turns on the type of plan involved — in particular, whether it is self-funded. The Departments' filing data for the second half of 2024 shows how this actually looks at scale, and it is not a clean picture.

Two things stand out. First, two-thirds of all federal disputes involve self-funded employer plans — the segment where the federal process applies regardless of what a state arbitration system covers. If your intake workflow does not capture funding status as a distinct field, it is missing the single most common fact pattern in this process.

Second, the No Issuer Response line: 114,960 filings — 13.5% of everything initiated in the half-year — where the issuer did not respond and the plan type was not established. Roughly one filing in eight went into the pipeline without a documented plan classification. The published tables do not break down how those specific filings ended, so treat this as a fact about the filing population, not a stated outcome rate. But it demonstrates something practical: plan-type identification fails at scale in this process, and it is reasonable to expect the other side to press on it.

What this means concretely: before initiating, be able to state the plan type for every claim in the batch, from a source you can point to later — not from an assumption based on the payer's brand name, since payers administer both self-funded and fully insured business. The claims where funding status cannot be documented are the natural targets of an eligibility challenge, and the data above shows how common the underlying problem is.

The Challenge Itself: Contested Eligibility and Where Those Disputes End Up

An eligibility challenge is not an edge case in this process — it is close to the default posture. Non-initiating parties challenged eligibility in 43% of all disputes initiated in the second half of 2024 (370,529 of 853,374), and in 45% of disputes initiated in the first half of 2024. Even after a certified IDR entity's initial review, the other side came back and contested eligibility in nearly half of filings.

The Departments identify the complexity of eligibility determinations as the main cause of delays in the process — not the merits arguments, not the volume of documentation on payment amounts, but figuring out whether a dispute belongs in the process at all. When you plan a filing calendar around arbitration timelines, plan for the eligibility fight to be where the time goes.

Here is how the 911,088 disputes closed in the second half of 2024 actually resolved:

Read the ineligible line against the challenge rate: eligibility was contested in 43% of filings, and roughly one closed dispute in five ended there. Most challenges do not succeed — but enough do that the contest itself is the gatekeeping event of the process.

The practical takeaway for a filing operation: treat the eligibility record — plan type, service category, negotiation dates, batching basis — as a deliverable in its own right, assembled and checked before initiation, not as paperwork the entity will sort out. The non-initiating party in your dispute is statistically likely to attack exactly that record, and the published data says the attack succeeds about one time in five across the whole population.

These figures describe the aggregate population of federal IDR disputes, not the odds of any particular filing.

What percentage of IDR disputes are found ineligible?

About 19% of disputes initiated in 2024 were found ineligible, according to CMS. That is down sharply from 69% in the first half of 2023, but it still means roughly one dispute in five never reaches a payment determination.

Is the open negotiation period 30 days or 30 business days?

Thirty business days — roughly six weeks. Sources that say '30 days' are wrong, and the difference is enough to miss the four-business-day window to initiate IDR that follows.

How long do I have to initiate IDR after open negotiation ends?

Four business days. This is one of the most common ways an otherwise strong claim is lost.

Does a state surprise-billing law override the federal process?

For plans the state can regulate, yes. But ERISA preempts state insurance regulation of self-funded employer plans, so those disputes go through the federal process even in states with their own arbitration system. Self-funded plans were the majority of federal disputes in 2024.