The decision in context
On August 11, 2026, the U.S. Court of Appeals for the Fifth Circuit issued a decision in litigation brought by the Texas Medical Association and other provider plaintiffs. The dispute concerns how federal rules direct plans and insurers to calculate the qualifying payment amount, or QPA, under the No Surprises Act.
The QPA generally reflects an insurer's median contracted rate for a covered item or service in a geographic area. It affects patient cost sharing for protected out-of-network care and must be considered during federal Independent Dispute Resolution. Because the insurer calculates the figure, the rules governing which contracted rates and payment components enter the calculation matter to providers evaluating an initial payment and preparing an IDR position.
Why “ghost rates” matter
The Fifth Circuit agreed with providers that the QPA calculation may not include negotiated “ghost rates”—contracted rates for items or services that a provider does not actually perform. A nominal rate in a contract can exist without reflecting a genuine negotiation over the market value of that service.
Including those rates can pull a median downward even when the contracting provider never expected to furnish the service. Excluding them ties the QPA more closely to rates associated with providers that actually perform the relevant care. The practical effect will still depend on how agencies revise the methodology and how plans implement that guidance.
Bonus and incentive payments belong in the calculation
The court also concluded that the challenged methodology improperly left certain bonus and incentive payments out of the contracted-rate calculation. When compensation under an agreement includes incentive-based components, omitting those amounts can make the figure used for the median lower than the payment arrangement as a whole.
Providers should not assume that every incentive arrangement will translate into a specific QPA adjustment. The ruling instead establishes a methodology issue that federal agencies and regulated plans must address. Contract terms, payment structure, reporting periods, and later guidance will shape implementation.
The air ambulance issue came out differently
The provider side did not prevail on every issue. The court upheld the exclusion of one-off air ambulance agreements used to price transportation for an individual patient from the QPA calculation.
That distinction is important. The decision is not a general rejection of the QPA or every component of the federal methodology. It resolves specific questions about which rates and payment elements fit the statute's definition and leaves other parts of the framework in place.
What the ruling may change—and what it does not
Correcting the methodology may affect future QPAs and the information used in negotiation or IDR, particularly where ghost rates or excluded incentive payments materially influenced the median. It may also create new reasons to compare payer disclosures and identify recurring patterns across similar services.
The ruling does not automatically recalculate every historical QPA, reopen a closed dispute, extend a deadline, or guarantee that a provider's offer will be selected. Its application to a particular claim depends on the service, plan, date, dispute posture, existing agency instructions, and any future implementation measures.
Practical steps for providers
- Preserve remittance records, QPA disclosures, plan communications, and open-negotiation correspondence.
- Identify services and payers where the QPA appears inconsistent with actual contracting experience.
- Document training, experience, case complexity, acuity, and other claim-specific information relevant to the dispute.
- Track agency guidance and payer notices addressing revised QPA methodology.
- Protect negotiation and IDR deadlines while the implementation consequences develop.
- Evaluate whether a methodology concern affects current strategy, a separate legal remedy, or neither.
The most useful response is evidence-driven. Providers need records that show how a payment was calculated, why the claim is eligible, and which facts support the requested amount under the rules applicable at that time.
Where legal review fits
Legal review can connect the appellate decision to the actual claim population. That includes determining which plan and legal framework apply, whether a deadline remains open, what information the payer disclosed, and whether the issue belongs in negotiation, federal IDR, a state process, or another forum.
A broad court decision can change the reimbursement environment without deciding an individual claim. Early review helps separate claims that require immediate action from those that should be monitored as agencies and plans respond.