BALTIMORE (LN) — A federal judge on Friday denied a motion to dismiss an air ambulance provider’s lawsuit to enforce a $31,480.93 payment award under the No Surprises Act, ruling that the statute implies a private right of action to compel insurers to pay binding independent dispute resolution determinations.
U.S. District Judge Adam B. Abelson of the District of Maryland held that Congress intended for providers to have a judicial remedy when health plans fail to pay IDR awards within the statutory 30-day window.
PHI Health, LLC, an air ambulance provider, sued Optimum Choice, Inc., doing business as United Healthcare, after the insurer refused to pay the full amount of an IDR award. PHI provided emergency transport services to a patient covered by an Optimum plan. The parties disputed the charge, with PHI billing $41,939.89 and Optimum paying only $10,458.96.
The dispute was referred to ProPeer Resources, LLC, a certified IDR entity. ProPeer issued an award in favor of PHI, determining that the full billed amount was the appropriate out-of-network rate. The award stated that payment "must be paid [to PHI Health] not later than 30 calendar days after the date of this notification."
Optimum did not pay the remaining balance. PHI filed suit in Maryland state court, seeking to confirm the award under the Federal Arbitration Act and asserting an implied cause of action under the No Surprises Act. Optimum removed the case to federal court and moved to dismiss, arguing that the Act does not create an express private right of action and that enforcement is delegated exclusively to the U.S. Department of Health and Human Services.
Abelson disagreed, finding that the Act’s text and structure unambiguously confer a federal right to payment on providers who prevail in IDR proceedings.
"Congress specified that a provider is owed a specific amount (as determined by the [certified IDR entity’s] ‘binding’ award), from a specific source (the insurer who participated in the IDR proceeding), by a specific deadline (within 30 days)," Abelson wrote, citing an amicus brief filed by the federal government.
The judge noted that the Act renders IDR awards "binding upon the parties involved" and mandates that payment "shall be made" within 30 days. Abelson concluded that this "money-mandating obligation" reflects congressional intent to create both a right and a remedy.
Abelson rejected Optimum’s argument that the Act’s limitation on "judicial review" precludes enforcement actions. He interpreted the phrase "judicial review" as referring only to challenges by non-prevailing parties seeking to vacate an award, not to enforcement actions by prevailing parties.
"The ordinary meaning of the phrase ‘judicial review’ refers to attempts by a non-prevailing party to seek ‘review’ of, i.e. to challenge, a decision," Abelson wrote.
The ruling adds to a split among lower courts on the issue. The Fifth Circuit Court of Appeals previously held in Guardian Flight, L.L.C. v. Health Care Service Corporation that the No Surprises Act does not authorize judicial enforcement of IDR awards. District courts have reached conflicting conclusions; for example, a Connecticut court found that providers may enforce awards in court, while a New Jersey court in Mod. Orthopaedics of NJ v. Premera Blue Cross found that they may not. Another New Jersey court, in GPS of N.J. M.D., P.C. v. Horizon Blue Cross & Blue Shield, found that providers may enforce awards.
Abelson’s opinion aligns with the position of the U.S. Department of Justice, which filed an amicus brief in the Fifth Circuit case arguing that the IDR process would "make little sense if the parties to a [certified IDR entity’s] payment determination lacked a means for judicial enforcement."
Optimum argued in its motion to dismiss that the IDR entity made a factual error by stating that Optimum had not submitted an offer, though the insurer did not file a motion to vacate the award based on fraud or misrepresentation. Abelson noted that Optimum’s failure to seek vacatur left the award binding and enforceable.
The case returns to the docket for further proceedings on the merits of PHI’s claim for the unpaid balance.