Fifth Circuit rules in favor of doctors on No Surprises Act payment calculations

A long-awaited appellate ruling on the No Surprises Act delivered a victory for health-care providers, with the Fifth Circuit concluding that the government erred in its guidance for computing the qualifying payment amount (QPA). The case originated from a 2022 lawsuit filed by the Texas Medical Association, which argued that the existing methodology yielded rates that were too low. The court agreed, directing that QPA calculations must not count so-called ghost rates—placeholder figures that providers never actually negotiate—and must factor in any bonus or incentive compensation.

Conversely, the judges dismissed the claim by air-ambulance providers that a one-off transport charge should be part of the QPA. This decision could raise reimbursement levels for many physicians and reshape how arbitration under the Act is conducted.