A Texas federal court has dismissed a Blue Cross and Blue Shield of Texas lawsuit against independent dispute resolution company HaloMD.
The lawsuit, filed in 2025, alleged HaloMD, which focuses on the provider side of IDR disputes, formed a scheme to exploit the arbitration process. BCBS Texas, under Health Care Service Corp., alleged the medical billing company submitted ineligible claims for resolution under the No Surprises Act and Texas state law.
In the May 22 decision, the judge interpreted BCBS Texas damages as tied to IDR awards, an “impermissible collateral attack.” The judge also did not see the injunction as an independent cause of action, and there cannot be judicial review of IDR awards.
“Left unresolved by today’s decision, in HaloMD’s view, is the growing backlog of past-due payments under the No Surprises Act that BCBS Texas and parent company HCSC owe to healthcare providers for care already provided to patients,” HaloMD Chief External Affairs Officer Patrick Velliky said in a May 27 news release. “HaloMD maintains HCSC has failed to pay tens of millions of dollars in legally binding awards.”
The case was dismissed with prejudice, meaning the same claims cannot be refiled. However, BCBS Texas notified the court of its decision to appeal.
“We are aware of the unfortunate decision of the Texas federal trial court and have filed an appeal. We support the intent of the NSA: taking patients out of payment disputes, while preventing unnecessary administrative burdens that drive up costs for American businesses and families,” a BCBS Texas spokesperson told Becker’s. “We will continue to advocate for meaningful reforms that address the root costs of rising healthcare costs.”
HaloMD has been a top initiating party for IDR disputes. The company has faced similar challenges before, including a dismissed case in California brought by Elevance Health, which also plans to appeal.
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