MULTIPLAN OUT-OF-NETWORK HEALTH INSURANCE ANTITRUST LITIGATION
BACKGROUND
The healthcare industry has been and continues to be plagued by significant financial challenges. Costs to providers are surging and sustaining operations has become a struggle for hospitals and other patient care centers. Many hospital systems have gone bankrupt over the last several years. Others, facing financial ruin, have been bought up by private equity companies. These consolidations leave patients with fewer healthcare options. Commercial health reimbursements comprise the majority of healthcare providers’ revenue. Providers therefore depend upon competition among commercial health insurers to ensure that commercial insurance reimbursement rates are sufficient to cover costs and preserve patient access to healthcare across the United States.
On behalf of out-of-network healthcare providers nationwide, Lockridge Grindal Nauen has filed a lawsuit alleging that beginning in or around July 2017, the reimbursements that providers nationwide have received for the out-of-network services they provided have been illegally suppressed as a result of a conspiracy between the commercial health insurance companies in the United States and MultiPlan, a claims “repricing” service. The lawsuit alleges a price-fixing conspiracy between these companies, through which these defendants perversely reap enormous profits off of the spread between what a provider claims for a given medical service and what the insurer actually pays.
All major commercial health insurers in the United States, and many smaller ones, have joined with MultiPlan to form a cartel dedicated to depriving healthcare providers of fair reimbursement for out-of-network services. This includes many well-known insurers, such as UnitedHealth, Cigna, Humana, Aetna, Centene, and Elevance (which includes many Blue Cross and Blue Shield associations). The complaint alleges that these insurers have taken an active role in perpetuating the anticompetitive scheme.
The cartel members agree on the method of pricing out-of-network claims. They agree to share their competitively sensitive reimbursement data to help drive the fake “repricing” algorithm through which MultiPlan and the insurers fix reimbursement prices. They work with MultiPlan to select “overrides” for that algorithm and agree to allow MultiPlan to align the “override” values across members of the cartel. The insurers agree to pay healthcare providers what MultiPlan tells them to pay, and not to undercut other cartel members with competitive pricing. They agree to condition payment on a provider’s agreement not to bill the patient for the proportion of the claim the insurer does not pay, a critical step in keeping the existence of the cartel secret.
In a competitive market, none of this would happen. If the market were competitive, each health insurer would fiercely guard its reimbursement data as competitively sensitive information, and would compete with other insurers by paying healthcare providers fairly for out-of-network healthcare services rendered, so that those physicians would provide healthcare when the insurers’ members need it.
MultiPlan and the insurance companies accomplished a reimbursement suppression scheme together that none could accomplish on their own. These defendants each collected from insurance-plan sponsors (usually employers) a percentage of the “spread,” or the difference between what a healthcare provider charges and what the insurer ultimately pays—as a fee for each claim suppressed, and then split that fee between themselves.
Out-of-network healthcare providers are harmed by this misconduct. The complaint alleges that the cartel has driven down the payments healthcare providers receive by between 61% and 81%, when compared with a transparent, accurate, and fair benchmark published by a non-profit formed for the express purpose of combatting price-fixing in the market for out-of-network medical claim reimbursements.
The lawsuit was filed in the United States District Court for the Northern District of Illinois on May 6, 2024, and is captioned Live Well Chiropractic PLLC v. MultiPlan, Inc., et al., No. 1:24cv03680. The defendants are MultiPlan, Inc., MultiPlan Corp., Viant, Inc., Viant Payment Systems, Inc., National Care Network, LP, National Care Network, LLC, UnitedHealth Group, Inc., Aetna, Inc., Elevance Health, Inc., Centene Corp., Cigna Group, Health Care Service Corp., Humana Inc., Kaiser Permanente LLC, Blue Shield of California, Inc., Blue Cross and Blue Shield of Florida, Inc., Blue Cross Blue Shield of Michigan Mutual Insurance Co., and Health Alliance Medical Plans, Inc.
ARTICLES & DOCUMENTS
CONTACT US
Are you a healthcare provider that provided out-of-network medical services since July 2017?
If you would like to discuss your legal options, please fill out the form below or contact Brian Clark, Steve Teti, or Kristie LaSalle at bdclark@locklaw.com, sjteti@locklaw.com, kalasalle@locklaw.com or at 612-339-6900.