Letters
RESEARCH LETTER
Dispute Resolution Outcomes
for Surprise Bills in Texas
A commercially insured patient who unknowingly receives outof-network care in an emergency or at an in-network facility may
face a “surprise bill” for the balance between the clinician’s charge
and the insurer’s out-of-network allowed amount. Texas prohibited surprise bills for out-ofnetwork emergency services
Supplemental content
and nonemergency ancillary
services at in-network facilities among fully insured health plan
enrollees, effective January 1, 2020.1 Under this law, patients pay
in-network cost sharing and health plans and out-of-network clinicians or emergency facilities resolve payment disagreements
through an independent dispute resolution (IDR) process. The law
provides different processes for facility and clinician services, and
this study focuses on clinicians.
The Texas IDR process begins with a teleconference to attempt settlement. If unsuccessful, the case escalates to arbitration. Each party offers a final payment amount. The arbiter must
select one of these offers after considering 10 factors, including
the 80th percentile of charges and the median of insurers’ innetwork payments for the same service(s) in the geographic area.
The Texas Department of Insurance uses payment benchmarks
from the independent nonprofit FAIR Health and certifies individuals with health care contract law experience as arbiters.
We assessed Texas IDR payment outcomes for clinicians
and compared them with arbitration benchmarks.
Methods | Texas IDR cases occurring from January 2020 through
March 2021 from multiple insurers, comprising more than half
of fully insured covered lives in Texas, were analyzed. The in-
surers provided service-level (Current Procedural Terminology code) data for this study, including the type of service,
charge, initial allowed amount, final allowed amount, local median in-network allowed amount, and 80th percentile of
charges per FAIR Health’s database, as well as whether the case
was settled or arbitrated. Allowed amounts include the direct
plan payments to physicians and patient cost-sharing amounts.
We calculated the ratio of IDR final allowed amounts to
FAIR Health’s median in-network allowed amounts and the
80th percentile of charges for each service. We computed
the median and IQR of these ratios across all services and
separately for settlements and arbitrations. Analyses were
performed in Stata version 15 (StataCorp). The Supplement
provides additional data and methodology details.
Results | The study sample included 47 280 service-level observations from 32 294 unique IDR cases involving clinicians. Services were predominantly emergency medicine (80%) and anesthesia (12%).
Disputed services in the sample had mean charges ($2306)
above the mean FAIR Health 80th percentile of charges benchmark ($1944) and mean initial allowed amounts ($192) below the
mean FAIR Health median in-network allowed amount benchmark ($634) (Figure 1). The mean IDR allowed amount outcome
($635) aligned closely with the FAIR Health median in-network
allowed amount benchmark. Overall, 74% of disputed services
weresettledthroughteleconference;meancharges,initialallowed
amounts, arbitration benchmarks, and IDR outcomes were relatively similar across settled and arbitrated cases.
The median ratio of IDR final allowed amounts to FAIR
Health median in-network allowed amounts was 1.06 (IQR,
0.89-1.25) and the ratio to the 80th percentile of charges was
0.37 (IQR, 0.30-0.46) (Figure 2). The median ratios of IDR fi-
Figure 1. Initial Charges and Allowed Amounts, FAIR Health Independent Dispute Resolution (IDR) Benchmarks,
and IDR Final Allowed Amounts for IDR Cases
2750
IDR cases
2500
All
2250
Settled
Arbitrated
Mean amount, $
2000
1750
1500
1250
1000
750
500
250
0
Initial charge
Initial allowed
amount
IDR starting position
2350
Final allowed
amount
IDR outcome
Median in-network
allowed amount
80th percentile
of charges
FAIR Health IDR benchmarks
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Letters
Figure 2. Ratios of Independent Dispute Resolution (IDR) Final Allowed Amounts to FAIR Health Benchmarks
A FAIR Health median in-network allowed amount
B
FAIR Health 80th percentile of charges
2.5
Ratio of IDR final allowed amount to FAIR
Health 80th percentile of charges
Ratio of IDR final allowed amount to FAIR
Health median in-network allowed amount
2.5
2.0
1.5
1.0
0.5
0
2.0
1.5
1.0
0.5
0
All
Settled
Arbitrated
All
IDR cases
Settled
Arbitrated
IDR cases
The line inside the box indicates the median; the top line of the box is the upper quartile; the bottom line of the box is the lower quartile; and the whiskers extend to
the 5th and 95th percentiles of the distribution.
nal allowed amounts to FAIR Health median in-network allowed amounts were modestly higher for arbitrations (1.12 [IQR,
0.97-1.28]) than for settlements (1.03 [IQR, 0.84-1.24]).
Discussion | The median final allowed amounts from Texas’ IDR
process were modestly higher than the FAIR Health median
in-network allowed amount benchmark but were well below
the benchmark of the 80th percentile of charges. Final allowed amounts resulting from IDR in Texas were lower than
in New York and New Jersey, where arbiters are not shown median in-network prices, and previous research found that mean
awards reflected the 80th percentile of charges benchmark.2,3
Beginning in January 2022, the federal No Surprises Act
prohibited surprise billing and established IDR. Initial regulatory guidance instructs arbiters to anchor decisions to median in-network prices, although ongoing lawsuits filed by hospital and physician groups seek to block its implementation.
Texas IDR outcomes suggest that arbiters may anchor to a median in-network price benchmark, even if they are not instructed on how to weigh various factors.
Study limitations include the short time after policy implementation and that the sample may not be generalizable to
other insurers.
Conflict of Interest Disclosures: Dr Trish reported receiving grants from Arnold
Ventures and the Commonwealth Fund; receiving personal fees from the Blue
Cross Blue Shield Association, Cedars Sinai Health System, Cornerstone
Research, Multiplan, Premera, Varian Medical Systems, and Centene; and being
on the editorial board of the American Journal of Managed Care and Medical
Care Research and Review and on the editorial review board of Inquiry. No other
disclosures were reported.
Funding/Support: This study was funded by Arnold Ventures.
Role of the Funder/Sponsor: The funder had no role in the design and conduct
of the study; collection, management, analysis, and interpretation of the data;
preparation, review, or approval of the manuscript; and decision to submit the
manuscript for publication.
1. TX SB1264, 2019-2020, 86th Legislature. LegiScan. Accessed November 13,
2021. https://legiscan.com/TX/bill/SB1264/2019
2. Adler L. Experience with New York’s arbitration process for surprise
out-of-network bills. Brookings. Published October 24, 2019. Accessed
February 24, 2022. https://www.brookings.edu/blog/usc-brookings-schaefferon-health-policy/2019/10/24/experience-with-new-yorks-arbitration-processfor-surprise-out-of-network-bills/
3. Chartock BL, Adler L, Ly B, Duffy E, Trish E. Arbitration over out-of-network
medical bills: evidence from New Jersey payment disputes. Health Aff (Millwood).
2021;40(1):130-137. doi:10.1377/hlthaff.2020.00217
Erin L. Duffy, PhD, MPH
Loren Adler, MS
Benjamin L. Chartock, PhD
Erin Trish, PhD
Author Affiliations: Leonard D. Schaeffer Center for Health Policy and
Economics, Los Angeles, California (Duffy, Trish); USC-Brookings Schaeffer
Initiative for Health Policy, Washington, DC (Adler); University of Pennsylvania
Wharton School, Philadelphia (Chartock).
Accepted for Publication: March 28, 2022.
Corresponding Author: Erin Trish, PhD, University of Southern California,
Leonard D. Schaeffer Center for Health Policy and Economics, 635 Downey
Way, VPD 412D, Los Angeles, CA 90089-3333 (etrish@usc.edu).
Author Contributions: Dr Duffy and Mr Adler had full access to all of the data in
the study and take responsibility for the integrity of the data and the accuracy of
the data analysis.
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Concept and design: All authors.
Acquisition, analysis, or interpretation of data: All authors.
Drafting of the manuscript: Duffy.
Critical revision of the manuscript for important intellectual content: Adler,
Chartock, Trish.
Statistical analysis: Duffy, Adler, Trish.
Obtained funding: Trish.
Administrative, technical, or material support: Adler.
Supervision: Adler.
Receipt of COVID-19 Booster Dose Among Fully
Vaccinated Pregnant Individuals Aged 18 to 49 Years
by Key Demographics
Booster doses of COVID-19 vaccines were recommended for
people aged 18 years or older in November 2021 following
the recommendation of an additional primary dose of
COVID-19 vaccine for select immunocompromised populations on August 13, 2021.1 As of February 26, 2022, more
than 93 million booster doses of COVID-19 vaccines had
been administered in the US2; however, data on receipt of
booster doses among pregnant individuals are lacking. We
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