Compliance
No Surprises Act 2026 Update: What Cost Sharing Means for You
New indexing factors under the No Surprises Act change how much cost-sharing consumers may pay for out-of-network medical services beginning January 1, 2026—understand your rights.
By NomadicTax Research Team • 5-8 min read • November 18, 2025
## What’s New Under the No Surprises Act for 2026
Effective **January 1, 2026**, payers (group health plans and issuers) must use updated **indexing factors** to calculate the **Qualifying Payment Amount (QPA)** for items or services provided under certain surprise billing clauses. ([irs.gov](https://www.irs.gov/irb/2025-47_IRB?utm_source=openai))
The percentage increase—the factor by which QPA increases over the prior year—is derived from the change in CPI-U (Consumer Price Index for All Urban Consumers) over the previous year. For 2025–2026, that factor is approximately **1.0265311701**. ([irs.gov](https://www.irs.gov/irb/2025-47_IRB?utm_source=openai))
Plans may calculate QPAs either by using cumulative factors from the base year (which could be 2019 or later) or by compounding the prior year’s QPA by the annual CPI-U increase. Either approach is acceptable so long as it’s applied consistently. ([irs.gov](https://www.irs.gov/irb/2025-47_IRB?utm_source=openai))
## Why This Matters: Compliance & Consumer Protection
- The QPA often sets the **baseline cost** for balancing billing disputes and determines what patients must pay when they receive services from out-of-network providers under surprise billing rules.
- Lower plans’ negotiated rates can affect cost sharing and dispute outcomes. Updated indexing helps preserve fairness in cost burden as healthcare costs rise.
- If your insurer or issuer miscalculates QPA or uses inconsistent methods, you may have a grievance under federal regulation.
## Practical Steps for Individuals and Employers
1. **Review your health plan’s notices and contracts.** Ask whether the QPA for 2026 will be calculated using cumulative or year-over-year indexing—and whether calculations are transparent.
2. **Understand how your enrollee documents define “out-of-network.”** QPA matters mainly when cost sharing, surprise billing, or Independent Dispute Resolution (IDR) come into play.
3. **Track billed charges vs. allowed QPA amounts.** If a provider wishes to balance bill beyond the QPA, documentation may assist in disputes.
4. **Employer sponsors should coordinate with insurers.** Ensure that summary plan documents, plan notices, and provider directories reflect correct indexing and QPA methodology in compliance with Notice 2025-65. ([irs.gov](https://www.irs.gov/irb/2025-47_IRB?utm_source=openai))
## Example Scenarios
- *Scenario 1:* Jane, who lives in a rural area, gets emergency surgery from an out-of-network specialist. The balance bill should reference the QPA as the baseline instead of negotiated rate inflation, and her cost share reflects that.
- *Scenario 2:* A policyholder reviewing renewal paperwork for their health plan notices an insurer listing two methods for calculating QPA. They ensure consistency and that the CPI-U increase is properly applied.
## Bottom Line
Patients are protected from unexpected medical bills in many situations. With Notice 2025-65, the IRS clarifies how inflation adjustments impact what you may pay. Always know your plan’s methodology, monitor for errors, and assert your rights under the No Surprises Act.