Fifth Circuit Rejects "Ghost Rates" in Federal QPA Calculations Under the No Surprises Act

HOUSTON, Aug. 25, 2026 /PRNewswire/ -- Nutex Health Inc. ("Nutex Health" or the "Company") (NASDAQ: NUTX), a physician-led, integrated health care delivery system comprised of 28 state-of-the-art micro hospitals and hospital outpatient departments in 12 states, as well as primary care-centric, risk-bearing physician networks, today commented on a recent ruling by the U.S. Court of Appeals for the Fifth Circuit invalidating key portions of federal regulations governing calculation of the qualifying payment amount (QPA) under the No Surprises Act (NSA).

"We applaud the court's decision on this important issue," said Tom Vo, M.D., MBA, Chairman and Chief Executive Officer of Nutex Health. "Since the NSA took effect in 2022, the agencies had directed the insurers to include non-negotiated ghost rates, artificially deflating the QPA calculations. The resulting depressed payments have created significant hardship for providers such as Nutex Health. As a result, providers have often had to pursue the Independent Dispute Resolution (IDR) process simply to obtain fair median in-network rates, an approach that is time-consuming and costly for both insurers and providers. We hope this landmark ruling will lead to fair and reasonable upfront payments, allowing us to continue delivering high-quality care to our patients."

The United States Court of Appeals for the Fifth Circuit held Aug. 11, 2026, while sitting en banc, that certain federal agency rules governing calculation of the QPA under the NSA were unlawful. The QPA is a benchmark figure calculated by insurers and used, alongside other factors, in the law's IDR process for resolving out-of-network payment disputes. The court ruled in favor of the Texas Medical Association and co-plaintiffs on two of the three issues raised. The decision may be subject to further appeal or rehearing.

Patient Protections Are Unaffected

The disputes addressed by this ruling are between insurers and providers. Under the NSA, patients receiving out-of-network emergency care, or out-of-network care at an in-network facility, are responsible only for their normal in-network cost-sharing amount and cannot be balance-billed. Nothing in this decision changes those patient protections.

Background on the QPA and IDR Process

Under the NSA, when a provider and an insurer cannot agree on payment for out-of-network care, the dispute may be submitted to an independent arbitrator, who weighs several factors equally, including the provider's training and experience, case complexity, market share, and the QPA. The QPA is calculated by the insurer and is intended to reflect the median, across the insurer's contracts for the same service, specialty, and region, of each contract's "total maximum payment," the patient's cost-sharing amount plus the amount paid by the plan.

The Court's Holding

The Fifth Circuit upheld the district court's previous holding that a 2021 federal agency rule implementing the NSA was inconsistent with the statute in two respects. First, while the rule excluded contracted rates of $0 (so-called "ghost rates") from the QPA calculation, it permitted insurers to include nonzero unnegotiated placeholder rates, including rates as low as $1. The court found no statutory basis for treating $0 and $1 unnegotiated rates differently. Second, the rule permitted insurers to exclude bonus and incentive payments from the calculation, which the court found inconsistent with the statute's "total maximum payment" standard. The court separately upheld the exclusion of one-off single-case agreements from the QPA calculation.

The court's opinion states that certified IDR entities selected a payment amount higher than the insurer-calculated QPA in approximately 85 percent of decided cases. (See also CMS' Independent Dispute Resolution Reports).

Potential Effects

We cannot predict when the relevant agencies will promulgate new rules and guidance in accordance with the court's ruling, or the content of such implementing rules. Following the ruling, once new regulations have been promulgated, insurers will have to recalculate QPAs to exclude ghost rates and include bonus and incentive payments. In the meantime, current enforcement relief permits insurers to continue using prior QPA methodologies for items and services furnished before October 1, 2026, subject to possible extension. The ultimate scope of the required changes will depend on the rules implemented by the relevant federal agencies, which have not been issued as of this release, and on the outcome of any further appeal.

The ruling invalidated the current agency rules and guidance but did not address several implementation questions that will ultimately have to be addressed in future agency rules and guidance, including: (1) whether a service must be provided more than once before its rate may be counted in the QPA; and (2) the mechanics of attributing bonus, incentive, and other non-fee-for-service payments to individual services.

Case: Texas Medical Association v. U.S. Department of Health and Human Services, No. 23-40605 (5th Cir. Aug. 11, 2026) (en banc).

About Nutex Health Inc.

Headquartered in Houston, Texas and founded in 2011, Nutex Health Inc. (NASDAQ: NUTX) is a healthcare management and operations company with three divisions: a Hospital Division, Population Health Management Division, and Real Estate Division. The Hospital Division owns, develops, and operates innovative health care models, including micro-hospitals, specialty hospitals, and hospital outpatient departments. This division owns and operates 28 facilities in 12 states. The Population Health Management division owns and operates provider networks such as Independent Physician Associations. Through our Management Services Organization, we provide management, administrative and other support services to our affiliated hospitals and physician groups. The real estate division comprises of real estate entities along with activity related to the development and construction of hospital facilities. The real estate entities own the land and hospital buildings which are leased to our hospital entities.

Forward-Looking Statements

Certain statements and information included in this press release constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. When used in this press release, the words or phrases "will," "will likely result," "expected to," "will continue," "anticipated," "estimate," "projected," "intend," "goal," or similar expressions are intended to identify "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks, known and unknown, and uncertainties, many of which are beyond the control of the Company. Such uncertainties and risks include, but are not limited to, regulatory and litigation uncertainty under the No Surprises Act, lawsuits filed by health insurance providers against our third party provider in the arbitration process, sales of a substantial amount of our Common Stock by our stockholders, our obligation to issue additional shares of our common stock to former doctor owners of under construction hospitals, manipulative short seller reports, the impact of litigation and disputes, our ability to successfully execute our growth strategy, economic conditions, dependence on management, lack of capital, the effects of rapid growth upon the Company and the ability of management to effectively respond to the growth and demand for products and services of the Company, newly developing technologies, the Company's ability to compete, conflicts of interest in related party transactions, regulatory matters, protection of technology, lack of industry standards, the effects of competition and the ability of the Company to obtain future financing. An extensive list of factors that can affect future results are discussed in the Annual Report on Form 10-K for the year ended December 31, 2025 and subsequent Quarterly Reports on Form 10-Q for the three months ended March 31, 2026 and the six months ended June 30, 2026, under the heading "Risk Factors" in Part II, Item IA thereof, and the risk factors and other cautionary statements contained in our other documents filed from time to time with the Securities and Exchange Commission. Such factors could materially adversely affect the Company's financial performance and could cause the Company's actual results for future periods to differ materially from any opinions or statements expressed within this press release.

SOURCE Nutex Health, Inc.