Second Circuit Joins Fifth Circuit in Holding No Private Right of Action Under No Surprises Act to Collect Unpaid IDR Awards

On September 17, the Second Circuit held that the federal NSA does not create a private right of action to enforce IDR awards in court. The decision, East Coast Advanced Plastic Surgery, LLC v. Cigna Health & Life Insurance Co., No. 25-2204, makes the Second Circuit the second federal appeals court to reach this conclusion, following the Fifth Circuit’s June 2025 ruling in Guardian Flight LLC v. Health Care Service Corp.

For providers, the message from both courts is the same: An IDR award is binding, but if a health plan does not pay, the only possible path to collection the NSA itself offers is through government regulators, not the courthouse.

It is noteworthy that the US District Court for the District of Connecticut had previously held in multiple cases, including Guardian Flight LLC v. Aetna Life Insurance Co. (discussed in a prior alert), that a private right of action was available under the NSA. The Second Circuit decision deals a blow to that precedent in Connecticut.

The Second Circuit’s Decision

East Coast Advanced Plastic Surgery (ECAPS), an out-of-network practice that performs breast reconstruction surgery for patients who have undergone mastectomies, initiated IDR proceedings against Cigna, an insurer and administrator of employer-sponsored group health plans. ECAPS won more than $3 million in IDR awards, but Cigna refused to pay. ECAPS sued, seeking a declaration that Cigna violated the NSA and owed the award amounts.

The district court dismissed the complaint, finding that the NSA does not allow providers to bring this type of lawsuit. On appeal, the Second Circuit asked whether the NSA’s text and structure show a “clear manifestation of congressional intent” to create a private right of action. The Second Circuit found no such clear showing, explaining three main reasons for its conclusion.

• What US Congress left out matters. Congress incorporated the Federal Arbitration Act provision that allows a court to vacate an arbitration award under narrow circumstances, but not the companion provision that allows a court to confirm and enforce one. The court held that Congress’ omission of this express enforcement right signals that it did not intend private enforcement suits.
• “Shall pay” and “binding” language is not enough. The court acknowledged that the NSA’s requirement that plans “shall pay” providers within 30 days of an IDR award gives providers a right to payment but held that it does not give them a right to sue. Likewise, calling an IDR award “binding” does not dictate who may enforce it.
• Congress built a government enforcement system instead. The court held that under the NSA’s statutory scheme, Congress intended IDR awards to be enforced by regulators — the US Department of Labor (DOL), the US Department of the Treasury, the US Department of Health and Human Services (HHS), and, for insurers, the states. Congress did not need to give the DOL and Treasury new enforcement authority in the NSA because the Employee Retirement Income Security Act (ERISA) and the tax code, which the NSA amends, already provide it. The court said that what matters is that Congress authorized agency enforcement, not how actively the agencies use it. The court did not directly address that the statutory scheme allows for penalties to be levied against plans for non-compliance, but that the funds collected do not go to providers. Still, plans that ignore awards still do face the risk of regulatory action.

The court also rejected ECAPS’ attempt to proceed under the federal Declaratory Judgment Act. The court explained that that statute provides a type of relief, not an independent basis to sue, so without a right to sue under the NSA, ECAPS had no claim to pursue.

Key Takeaways for Providers

Providers in the Second and Fifth Circuits seeking to enforce IDR awards under the NSA itself now face adverse and binding precedent. These providers seeking payment on IDR awards will likely rely on complaints to the DOL, Treasury, HHS, or state insurance regulators, or on other legal theories in court. The Second Circuit did not address other theories of recovery, such as under ERISA or state-law claims. The Fifth Circuit, by contrast, rejected the providers’ ERISA and Texas quantum meruit claims in Guardian Flight.

Despite these decisions, private enforcement of NSA IDR awards is not over. At least one federal district court — the US District Court for the District of Maryland in PHI Health, LLC v. Optimum Choice, Inc. — recently held that providers do have a private right of action under the NSA. And providers can still seek recovery outside of the NSA even in jurisdictions with adverse NSA precedent. Recognizing this, some providers are now bringing state-law claims, such as breach of contract, unjust enrichment, and quantum meruit, to collect amounts owed by plans.

Providers should watch these cases and also stay up to date on developments in the IDR process, particularly the sweeping changes instituted by the final rule issued by Treasury, DOL, and HHS in June. For an overview of these changes and important new procedural requirements, see our alert here.

ArentFox Schiff will continue to follow this subject. If you have questions about how this decision affects your organization’s IDR strategy or collection efforts, please contact the authors or your ArentFox Schiff relationship attorney.