The Phia Group's new "National NSA Report on Aggressive Provider Billing" exposes systemic billing patterns and arbitration strategies under the No Surprises Act (NSA) that are driving up unnecessary costs for employers — often without patients ever seeing the bill.
Using more than 1.25 million federal arbitration disputes and data from more than 23,000 health care providers, the report ranks states by the prevalence of providers engaging in high-offer and high-billing behaviors. A subsequent pattern suggests strategic positioning to inflate Independent Dispute Resolution (IDR) outcomes at the expense of employer-sponsored health plans.
"The No Surprises Act was designed to protect patients, not to create a new revenue strategy for providers," said Scott Bennett, Chief Provider Relations Officer at The Phia Group, a health care cost-containment firm. "Our analysis shows that in many states, arbitration has become a tool for extracting higher payments from employer plans, undermining the law's intent and increasing health care waste."
To assess provider behavior under the NSA, The Phia Group categorized providers using a four-tier classification system based on relative billing ratios and IDR offer levels. Providers were classified as: Category 1 (relatively low billing ratio, low end of IDR offers), Category 2 (relatively high billing ratio, low end of IDR offers), Category 3 (relatively high billing ratio, high end of IDR offers), and Category 4 (relatively low billing ratio, high end of IDR offers).
Nevada: The highest-risk state
Nevada stands out as the most extreme example of having aggressive provider behavior, according to the report. More than half of Nevada providers analyzed (42 of 75, or 56%) fall into the highest-risk categories, classified as Category 3 and 4 — the largest share of any state in the dataset. Other high-risk states include South Carolina (43%), Arkansas (42%), Louisiana (41%), and Colorado (40%).
Large states show moderation but still significant incidence of Category 3 and Category 4 providers: Texas (24%), Florida (22%), and New York (23%). Lower-risk states include Michigan (14%), Pennsylvania (13%), Indiana (13%), Illinois (10%), and Wisconsin (9%).
Meanwhile, Tennessee emerged as a major dispute volume driver, with 147 providers generating 36,116 disputes, while still showing a relatively high Category 3 and Category 4 share (31%).
Why does this matter?
The patterns identified in the report indicate that some providers may be using elevated offer strategies to influence arbitration outcomes — ultimately, driving awards above reasonable payment levels and increasing employer plan costs without improving patient protection, according to The Phia Group.
"Brokers and advisors are on the front lines of helping employers manage health care costs and navigate an increasingly complex regulatory landscape," said Adam Russo, CEO of The Phia Group. "This audit underscores how critical it is for these professionals to look beyond surface solutions and partner with experts who can truly unpack cost drivers like arbitration behavior."
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