A California federal judge dismissed an Elevance Health subsidiary’s lawsuit that alleged that HaloMD and several providers conspired to exploit the No Surprises Act’s Independent Dispute Resolution process for financial gain.
Anthem Blue Cross alleged that HaloMD and affiliated providers submitted more than 1,500 IDR proceedings between January 2024 and August 2025, of which roughly 47% were ineligible for arbitration. Anthem alleged the submission volume was deliberate and designed to overwhelm claims staff and confuse arbitrators into rubber-stamping inflated payment awards.
The lawsuit included alleged anti-racketeering law and Employee Retirement Income Security Act violations and sought to vacate arbitration awards.
In her April 9 ruling, Central District of California Judge Karen Scott said that judicial review of IDR determination is narrowly constrained and does not extend to routine challenges or enforcement actions.
Justin Carangelo, General Counsel for HaloMD, said in an April 13 news release that the judge’s decision defends the integrity of the No Surprises Act.
“We are grateful the court recognized that allowing insurers to relitigate every unfavorable arbitration outcome in federal court would completely undermine Congressional intent,” Mr. Carangelo said.
An Elevance spokesperson said the company strongly disagrees with the court’s ruling, which it said was based on a procedural issue and “did not address most of our arguments.”
“We believe it misinterprets the No Surprises Act and improperly limits judicial review, and we intend to appeal with confidence in our position,” the spokesperson said. “Elevance Health will continue to hold billing companies and out-of-network providers accountable for practices that we believe drive up healthcare costs and burden consumers, as we work to support the intent of the No Surprises Act and advance a healthcare system that is transparent, fair and drives down the cost of care for the people we serve.”
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