No Surprises Act: No Implied Private Right of Action to Enforce IDR Payment Awards

Introduction

This appeal required the Second Circuit to decide whether the No Surprises Act (“NSA”)—a statute that created an “independent dispute resolution” (“IDR”) arbitration-like mechanism for certain out-of-network payment disputes—permits providers to sue in federal court to collect unpaid IDR awards.

Plaintiff East Coast Advanced Plastic Surgery, LLC (“ECAPS”), an out-of-network provider, obtained more than $3 million in IDR determinations against Cigna (a health-plan administrator). ECAPS alleged Cigna failed to pay within the NSA’s 30-day payment deadline and sought declaratory relief that Cigna owed the awarded amounts and violated the NSA. The Southern District of New York (Engelmayer, J.) dismissed, holding the NSA contains no implied private cause of action. The Second Circuit affirmed, adopting a text-and-structure analysis focused on congressional intent and the statute’s administrative enforcement scheme.

The case unfolded against broader disputes about surprise billing and the NSA’s implementation, which the court described by reference to earlier circuit litigation about the statute’s purpose and mechanics.

Summary of the Opinion

The court emphasized: (i) the NSA’s text selectively incorporates the Federal Arbitration Act (“FAA”) vacatur provision (9 U.S.C. § 10(a)) but not the FAA confirmation provision (9 U.S.C. § 9), and (ii) the NSA’s broader “interlocking” enforcement structure assigns compliance policing to the Department of Labor (“DOL”), the Department of the Treasury (“Treasury”), the Department of Health and Human Services (“HHS”), and state regulators, indicating Congress chose administrative enforcement rather than private collection suits.

Analysis

1. Precedents Cited

The opinion is best read as an application of the Supreme Court’s modern skepticism toward implied rights of action, coupled with a statutory-design inference: where Congress supplies detailed administrative enforcement tools, courts should not add a private remedy.

• Purpose and context of the NSA:
  • Neurological Surgery Prac. of Long Island, PLLC v. U.S. Dep't of Health & Hum. Servs.: Cited to explain Congress’s aim—preventing “surprise” out-of-network bills and shifting payment disputes away from patients.
  • Tex. Med. Ass'n v. U.S. Dep't of Health & Hum. Servs.: Cited for a similar account of the problem Congress addressed and to situate the NSA within national policy concerns.
• Pleading posture and standards of review:
  • Nat'l Credit Union Admin. Bd. v. U.S. Bank Nat'l Ass'n: Used for the proposition that, on dismissal, the court takes the complaint’s facts as true.
  • Ricci v. Teamsters Union Loc. 456 and Vengalattore v. Cornell Univ.: Cited for de novo review of motions to dismiss and purely legal determinations about statutory private rights of action.
• Modern implied-right-of-action doctrine (text and structure; congressional intent):
  • FS Credit Opportunities Corp. v. Saba Cap. Master Fund, Ltd.: Quoted for the baseline proposition that “Congress determines who may sue to enforce federal law” and typically creates private rights expressly.
  • Cisco Sys., Inc. v. Doe I: Cited to emphasize separation-of-powers concerns with “home-grown” causes of action.
  • Lopez v. Jet Blue Airways and Alexander v. Sandoval: Provide the controlling framework: implied private causes of action are “strictly curtailed,” and courts require a “clear manifestation” of congressional intent derived from statutory text and structure.
  • Murphy Med. Assocs., LLC v. Yale Univ.: Supplies the Second Circuit’s two-step emphasis: (i) rights-creating language, and (ii) whether the enforcement scheme manifests intent to create a private remedy rather than agency enforcement.
  • Moya v. U.S. Dep't of Homeland Sec. and Hallwood Realty Partners, L.P. v. Gotham Partners, L.P.: Reinforce that implied rights of action are disfavored.
  • Gonzaga Univ. v. Doe: Cited for the key distinction between a private “right” and a private “remedy,” and to reject importing § 1983 presumptions into implied-right analysis.
  • Bellikoff v. Eaton Vance Corp.: Used to start from the presumption against an implied private right where Congress did not provide an express one.
• Parallel circuit authority on the NSA’s IDR enforcement question:
  • Guardian Flight, L.L.C. v. Health Care Serv. Corp.: The Second Circuit expressly “join[ed]” the Fifth Circuit’s conclusion that the NSA does not imply a private right of action to enforce IDR awards, relying particularly on the statutory enforcement scheme and the FAA cross-reference structure.
  • District court split noted (not followed): Guardian Flight LLC v. Aetna Life Ins. Co. (finding an implied cause) contrasted with Axis Neuromonitoring, LLC v. Aetna Inc. (rejecting one).
• Declaratory Judgment Act limits:
  • Chevron Corp. v. Naranjo and In re Joint E. & S. Dist. Asbestos Litig.: Cited for the settled rule that the Declaratory Judgment Act does not create an independent cause of action; it requires an underlying substantive right to relief.
• Rejected analogies:
  • Maine Cmty. Health Options v. United States: Discussed to explain why Tucker Act “shall pay” cases (money-mandating claims against the federal government) do not translate into implied private remedies against private parties under the NSA.

2. Legal Reasoning

A. Text: selective FAA incorporation signals no private enforcement remedy

The court placed substantial weight on a negative textual implication. The NSA makes IDR determinations “binding” and bars “judicial review” except for FAA vacatur grounds, expressly incorporating only 9 U.S.C. § 10(a). But Congress did not incorporate FAA confirmation (9 U.S.C. § 9), the ordinary vehicle by which a prevailing party turns an arbitration award into an enforceable judgment. The court treated this omission as strong evidence Congress did not intend providers to bring “confirmation/enforcement” suits for IDR awards.

The court bolstered this inference by pointing to an example where Congress did incorporate FAA confirmation provisions: 5 U.S.C. § 580(c) (“may be enforced pursuant to sections 9 through 13 of title 9”). The contrast supported the conclusion that Congress knew how to authorize judicial enforcement when it wished.

B. Rights-creating language exists, but it is not enough without a private remedy

The NSA states the plan “shall pay” the provider, including within 30 days after an IDR determination (29 U.S.C. § 1185e(c)(6)). The court acknowledged this resembles “rights-creating language” under Murphy Med. Assocs., LLC v. Yale Univ.. But invoking Gonzaga Univ. v. Doe and Alexander v. Sandoval, it held that even clear rights language does not itself establish that Congress created a private remedy—the separate inquiry on which ECAPS failed.

C. Structure: an interlocking administrative enforcement scheme displaces implied private suits

The opinion’s core structural point is that the NSA’s “triple codification” (ERISA, the Internal Revenue Code, and the Public Health Service Act) is matched by an enforcement design that assigns compliance to:

• DOL: authority to sue to enjoin ERISA Subchapter I violations and obtain equitable relief (29 U.S.C. § 1132(a)(5)), applicable to non-governmental employer plans.
• Treasury: authority to impose a tax for failures of non-governmental group health plans to meet NSA requirements (I.R.C. § 4980D(a)).
• HHS: authority to impose civil money penalties on non-federal governmental plans (42 U.S.C. § 300gg-22(b)(2)(A)).
• States: authority to require health insurance issuers in the state to meet NSA requirements (42 U.S.C. § 300gg-22(a)(1)).

Drawing on Alexander v. Sandoval (“express provision of one method … suggests Congress intended to preclude others”) and the Supreme Court’s reasoning in FS Credit Opportunities Corp. v. Saba Cap. Master Fund, Ltd. (agency enforcement responsibility supports the absence of private enforcement), the court concluded Congress made a policy choice: NSA compliance—including timely payment of IDR awards—would be enforced primarily through administrative mechanisms, not private litigation.

D. Rejection of ECAPS’s counterarguments

• No need for the NSA to restate DOL/Treasury powers: The court held it was unsurprising the NSA did not redundantly confer enforcement authority where ERISA and the tax code already do, citing Murphy Med. Assocs., LLC v. Yale Univ. and Lopez v. Jet Blue Airways.
• Agency “minimal enforcement” is irrelevant: The question is what Congress authorized, not the intensity of agency action.
• “Binding” does not identify an enforcer: “Binding” status does not answer who may sue to enforce payment.
• Tucker Act and § 1983 analogies fail: Tucker Act “money-mandating” principles (Maine Cmty. Health Options v. United States) concern suits against the federal government, and § 1983 provides its own remedial presumption (Gonzaga Univ. v. Doe) that is inapplicable to implied-right claims.
• FAA vacatur incorporation is not “absurd” without private enforcement: Parties may still seek vacatur rather than ignore awards and risk administrative enforcement; providers might also seek vacatur of low awards.
• IDR regime not “meaningless”: The regime retains force through administrative enforcement; Congress may have chosen to avoid “floodgates” litigation.

E. Declaratory Judgment Act cannot substitute for a missing cause of action

The court treated this as straightforward: without a substantive cause of action under the NSA, the Declaratory Judgment Act cannot independently authorize relief, per Chevron Corp. v. Naranjo and In re Joint E. & S. Dist. Asbestos Litig..

F. Issue left open: whether the NSA’s “judicial review” bar also forecloses confirmation/enforcement suits

Cigna argued that the NSA provision limiting “judicial review” to FAA vacatur grounds independently bars lawsuits to confirm or enforce awards, an interpretation adopted in Guardian Flight, L.L.C. v. Health Care Serv. Corp.. The Second Circuit did not decide that question, holding instead that even if the judicial-review bar does not foreclose the suit, ECAPS still lacked a cause of action.

3. Impact

• Providers’ collection pathway shifts to regulators, not courts: In the Second Circuit, out-of-network providers holding unpaid NSA IDR awards cannot sue (at least under an implied NSA cause of action) to compel payment. Practical leverage moves toward complaints to DOL/Treasury/HHS or state insurance regulators, depending on the plan/issuer type.
• Litigation re-channeling: Parties may redirect disputes into other legal frameworks (e.g., contract claims where separate network agreements exist, fraud/recoupment actions like Cigna’s parallel suit, or limited FAA-style vacatur challenges contemplated by the NSA).
• Uniformity with the Fifth Circuit: By “join[ing]” Guardian Flight, L.L.C. v. Health Care Serv. Corp., the Second Circuit reduces forum-shopping incentives and pushes toward a more consistent national rule—unless and until another circuit disagrees or Congress amends the statute.
• Administrative capacity pressure: The decision implicitly increases the importance of agency and state enforcement responsiveness; delays or under-enforcement could translate into delayed payment even after providers prevail in IDR.
• Statutory drafting signal: The opinion underscores that selective incorporation of remedial provisions (vacatur but not confirmation) will be read as deliberate. Future healthcare arbitration-like schemes may be drafted with more explicit enforcement language if Congress intends judicial collection.

Complex Concepts Simplified

• IDR (Independent Dispute Resolution): A statutorily mandated “baseball arbitration” process where each side submits a number and the IDR entity picks one, producing a binding payment amount.
• Implied private right of action: A judicially recognized ability to sue under a statute that does not expressly say “you may sue.” Modern doctrine requires clear evidence Congress intended not only a private right but also a private remedy.
• Rights-creating language vs. private remedy: “Shall pay” can create an entitlement, but courts still ask whether Congress meant private lawsuits to be the enforcement tool, especially where agencies are empowered to enforce.
• FAA vacatur vs. confirmation: Vacatur (FAA § 10(a)) is a narrow challenge to set aside an award for serious defects (fraud, bias, misconduct, exceeding powers). Confirmation (FAA § 9) is the mechanism to turn an award into a court judgment for collection. The NSA referenced the former, not the latter.
• Declaratory Judgment Act: A procedural device letting courts declare parties’ rights when an actual controversy exists; it does not supply substantive legal rights by itself.
• “Triple codification” and enforcement allocation: The NSA appears in ERISA, the tax code, and the Public Health Service Act; correspondingly, DOL, Treasury, HHS, and states each play roles in enforcement depending on whether the coverage is a private employer plan, governmental plan, or insurance issuer.

Conclusion

E. Coast Advanced Plastic Surgery, LLC v. Cigna Health & Life Ins. Co. establishes (for the Second Circuit) a clear rule: providers cannot privately sue under the NSA to enforce unpaid IDR awards because Congress did not create an implied private remedy and instead built a comprehensive administrative enforcement scheme. The court’s reasoning turns on modern implied-right doctrine (Alexander v. Sandoval; Gonzaga Univ. v. Doe) and a telling textual choice—incorporating FAA vacatur but not confirmation.

The decision strengthens the administrative-centered model of the NSA: the IDR outcome may be “binding,” but payment enforcement is, absent an express congressional authorization, principally the province of regulators rather than private federal litigation.