Compliance
Compliance Spotlight: No Surprises Act & Group Health Plan Cost-Sharing in 2026
Starting January 1, 2026, new indexed amounts affect patient cost sharing under the No Surprises Act—this article helps employers and health plans prepare.
By NomadicTax Research Team • 5-8 min read • November 20, 2025
## 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](https://www.irs.gov/irb/2025-47_IRB?utm_source=openai))
## 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](https://www.irs.gov/irb/2025-47_IRB?utm_source=openai))
Some highlights:
- The effective period is **January 1, 2026 through December 31, 2026**. ([irs.gov](https://www.irs.gov/irb/2025-47_IRB?utm_source=openai))
- The indexing factors adjust historical median rates and account for inflation to update what health plans must consider “qualifying payment.” ([irs.gov](https://www.irs.gov/irb/2025-47_IRB?utm_source=openai))
## 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.