AHIP wants a judge to side with the federal government in an ongoing lawsuit over a regulation that would limit patient costs for out-of-network air ambulance transportation.

In an amicus brief submitted Tuesday, the insurance lobby said the government’s rule is appropriate, and in the best interest of consumers and insurers.

The process set up by the federal government “reduces the likelihood and costs of resolving disputes, furthers predictability and efficiency, and helps remedy a uniquely dysfunctional market dynamic that foisted supracompetitive air ambulance charges on patients for far too long,” AHIP wrote in its brief .

The Association of Air Medical Services sued the federal government in November, saying the interim final rule gave insurers too much power over bill arbitration, would force air ambulance providers to accept lower rates and even limit access to emergency care.

The rule, part of a spat of regulations created to implement the No Surprises Act and limit cost-sharing for out-of-network claims, went into effect Jan. 1.

AHIP contends that air ambulance practices are an “extreme example” of what happens when providers lack incentives to join insurance networks. Roughly 69% to 75% of air ambulance transports are out-of-network, compared to 51% of ground ambulance rides, AHIP wrote in its brief, citing a 2019 Government Accountability Office report.

“Air ambulance providers have leveraged that out-of-network status—and the associated ability, until now, to send surprise bills to patients—to extract large payments from patients with commercial insurance,” AHIP wrote.

Additionally, because of exorbitant charges for air ambulance rides, insurers may pay air ambulances’ out-of-network costs to help consumers avoid surprise bills, AHIP wrote.

In the absence of network agreements, the federal government’s decision that arbitrators of out-of-network bills should first consider a plan’s median in-network rate for a service provided in the area makes sense, AHIP wrote.

AHIP believes making out-of-network rates more predictable will benefit healthcare markets and patients. A more predictable dispute resolution process will make parties more likely to settle disputes on their own, which could help them avoid the costs of arbitration.

“Even though the act bans surprise billing, Americans would still pay the increased costs of an unpredictable dispute resolution process through higher premiums,” AHIP argued.

Provider groups across many medical sectors and specialties have admonished the government’s surprise billing regulations for giving insurers the upper hand in billing disputes. Another ongoing lawsuit filed by the American Medical Association and American Hospital Association also challenges the dispute resolution process.