Lower Premiums, Faster Payments Act
- Sponsor
- Rep. Pallone, Frank [D-NJ-6]
- Committees
- Ways and Means Committee (primary)
- Last action
- Oct 9, 2026
Bottom line
This bill aims to streamline out-of-network billing by removing the IDR process and establishing a new, CPI-indexed benchmark for payment, potentially impacting provider reimbursement and health plan costs.
What it actually does
The bill, titled the "Lower Premiums, Faster Payments Act," significantly amends the surprise medical billing requirements established under the No Surprises Act. It eliminates the independent dispute resolution (IDR) process for services furnished on or after January 1, 2028, and revises the methodology for calculating the Qualifying Payment Amount (QPA) to be based on 2019 median contracted rates adjusted by the Consumer Price Index (CPI) for all urban consumers. These changes apply across the Public Health Service Act, Internal Revenue Code, and ERISA.
Proponents argue
Supporters would argue that eliminating the IDR process will reduce administrative burden and costs for health plans, which could translate into lower premiums for consumers. They would also contend that pegging the QPA to a 2019 baseline adjusted by CPI provides a more stable and predictable payment standard, preventing excessive increases in healthcare costs and ensuring faster payments to providers by removing the need for lengthy disputes.
Opponents contend
Opponents would likely argue that removing the IDR process eliminates a crucial mechanism for fair negotiation between providers and insurers, potentially leading to underpayment for out-of-network services. They might contend that basing the QPA on 2019 rates, even with CPI adjustments, does not adequately account for actual increases in healthcare costs, technological advancements, or regional variations, thereby disadvantaging providers and potentially impacting access to care.
The bill is moderately lengthy and makes complex technical amendments, requiring careful reading to understand the full implications of the changes to existing law.
Section 2(a)(1) (PHSA), 2(b)(1) (IRC), 2(c)(1) (ERISA)
Sunset of Independent Dispute Resolution Process
This provision amends existing law to specify that the independent dispute resolution (IDR) process, which allows providers and insurers to negotiate payment rates for out-of-network services, will no longer apply to services furnished on or after January 1, 2028. For services furnished before this date, the IDR process remains in effect. This effectively removes the arbitration mechanism for resolving payment disputes for future surprise medical bills.
Supporters argue
Supporters argue that the IDR process has been costly, inefficient, and has led to higher healthcare costs by often favoring providers, thus driving up premiums. Eliminating it simplifies the system and reduces administrative overhead, which can ultimately benefit consumers through lower premiums.
Critics contend
Critics contend that the IDR process is essential for ensuring fair compensation for providers, especially for specialized or emergency services where patients have no choice of provider. Removing it could empower insurers to unilaterally set lower rates, potentially leading to providers opting out of networks or reducing services, thereby limiting patient access to care.
Tradeoffs
The bill trades off the administrative complexity and potential cost inflation associated with the IDR process against the risk of providers being underpaid and potentially reducing access to out-of-network care. It seeks to reduce healthcare costs for consumers and insurers by streamlining payments, but this could come at the expense of provider financial stability and patient choice.
Section 2(a)(2) (PHSA), 2(b)(2) (IRC), 2(c)(2) (ERISA)
CPI-Indexed 2019 Median Contracted Rate for QPA
This provision fundamentally alters how the Qualifying Payment Amount (QPA) is calculated for services furnished on or after January 1, 2028. Instead of the current methodology, the QPA will be based on the median of contracted rates recognized by the plan or issuer on January 31, 2019, for the same or similar services, adjusted annually by the Consumer Price Index for all urban consumers (CPI-U) from 2019 through the current year. New plans or plans without 2019 data will use a Secretary-established methodology, also CPI-indexed.
Section 2(a)(2)(B) (PHSA), 2(b)(2)(B) (IRC), 2(c)(2)(B) (ERISA)
Expedited Rulemaking and No Judicial Review for QPA Methodology
This provision mandates that the Secretaries of HHS, Labor, and Treasury update the rules for determining the QPA methodology within 180 days of enactment, specifically for services furnished in 2028 and subsequent years. It explicitly allows for expedited rulemaking (interim final rule) and states that there shall be no judicial review of the methodology established under this subparagraph.
Section 2(a)(2)(C) (PHSA), 2(b)(2)(C) (IRC), 2(c)(2)(C) (ERISA)
Mandatory Annual Audits and Public Reporting of QPA Data
This provision amends the requirements for annual audits of QPA data. For 2028 and subsequent years, the Secretaries shall conduct audits of claims data from a sample of not less than 25 group health plans and health insurance issuers (previously "may" conduct audits for a smaller sample). Crucially, the findings of these audits, along with the number of audits, shall be made publicly available starting in 2028.
Starting in 2028, the Secretaries are required not only to submit annual reports on QPA audits to Congress but also to make the findings of each such audit publicly available. Previously, only the number of audits was reported to Congress, and public availability was not mandated.
Section 2(a)(2)(C)(iii) (PHSA), 2(b)(2)(C)(iii) (IRC), 2(c)(2)(C)(iii) (ERISA)
Why it matters:This is standard legislative practice for amending existing text, but the impact of making audit findings public could be easily overlooked by a casual reader focusing on the larger policy shifts.
Case for: Proponents would argue that public transparency of audit findings is crucial for accountability, allowing stakeholders and the public to verify that QPA calculations are fair and consistent, and to identify any systemic issues in implementation.
Case against: Some insurers might argue that publicizing detailed audit findings could inadvertently expose proprietary business practices or lead to misinterpretations of complex data, potentially creating undue public pressure or competitive disadvantages.
Estimated impact: Increases transparency significantly for how QPA is determined and enforced, affecting all audited health plans and potentially influencing market behavior.