What’s the No Surprises Act & Qualifying Payment Amount (QPA)?
The No Surprises Act protects patients from unexpected medical bills—particularly when they're treated by out-of-network providers without their knowledge. The Qualifying Payment Amount (QPA) sets a benchmark for cost sharing when insurers and employees settle out-of-network charges. (irs.gov)
What Changed in Notice 2025-65
Issued in the IRS’s Internal Revenue Bulletin for Nov. 17, 2025, Notice 2025-65 lays out the indexing factors that group health plans and health insurance issuers should use to calculate QPAs for services provided during 2026. (irs.gov)
Some highlights:
- The effective period is January 1, 2026 through December 31, 2026. (irs.gov)
- The indexing factors adjust historical median rates and account for inflation to update what health plans must consider “qualifying payment.” (irs.gov)
Who Must Comply?
- Group health plans governed by ERISA
- Health insurance issuers under the Public Health Service Act
Businesses and plan sponsors must ensure compliance to avoid regulatory penalties.
Actionable Steps for Employers and Health Plans
- Review current contracts and out-of-network fee schedules: Compare with the new QPA to identify potential underpayments.
- Update plan documents and participant communications to reflect new benchmarks. Many participants are unaware of how surprise billing rules apply—periodic disclosure is essential.
- Train claims processing teams: Ensure staff who handle ad hoc billing reviews, reimbursement, and out-of-network balance billing are familiar with QPA and how cost sharing works under new rates.
- Check appeals and disclosure policies: Under the Act, providers can challenge QPA determinations. Employers need internal mechanisms to respond.
Examples of Practical Impact
- An employer whose out-of-network reimbursements were historically set at amounts lower than the updated QPA may find that cost sharing for employees increases or that the employer must adjust reimbursement.
- Employees seeing out-of-network specialists could see lower surprise bills if the QPA lowers their personal out-of-pocket obligations.
Why It Matters
- Helps avoid costly audits or regulatory enforcement for group health plans
- Impacts employee satisfaction—unexpected medical bills cause financial hardship
- Financial planning for self-insured employers must now incorporate new cost sharing requirements and updated actuarial assumptions
Bottom Line: Notice 2025-65 sets out the guideposts for 2026. Start reviewing, consulting legal or benefits counsel, and adjusting policy documents now to ensure your plans are compliant and your members protected.