Ingenix has had a tough few months. The latest injury comes in the form of a suit filed by a Connecticut man, seeking class action status based on allegations that the United HealthCare sub engaged in an “alleged conspiracy in which insurance companies calculate their usual, customary and reasonable rates from a flawed and manipulated Ingenix database. The low payments to providers, according to the lawsuit, left Weintraub and other consumers with higher out-of-pocket costs.” (Modern Healthcare)
For the legal folks out there, the full case can be accessed here. (PACER sub req)
The plaintiff, Jeffrey Weintraub, is suing Ingenix, their parent, UnitedHealth Group Inc; sister company Oxford Health Plans, as well as Aetna Inc, Cigna Corp, Empire BlueCross BlueShield, Humana Inc, Group Health Ins Inc, Health Ins Plan of NY and Health Net Inc.
OK, so what does this mean? My sense is this is piling on; since the Cuomo announcement Ingenix has been a highly visible target, and based on the company’s rather lackadaisical approach to defending its methodology in the Davekos case, it looks like the legal sharks smell blood in the water.
But just because it is piling on does not mean these cases are without merit.
I would expect to see more of these suits filed, perhaps in more class-action friendly jurisdictions (Mississippi, for example). I also expect the industry to rally around Ingenix – this is a very, very big deal, and one that has been mishandled so far. Ingenix, and the health payer industry, cannot afford any more mishaps.
Thanks to Fierce Healthcare for the heads’ up.
May
7
I infer that the plaintiff was harmed in this way: 1. the insurer compensated the provider using a manipulatedly low U & C calculation. 2. The insurer’s agreement with the provider does not prohibit balanced billing, OR, the plaintiff had a high deductible and the agreement did not require the doctor to charge no more than the amount the amount that the insurer would pay…..but some of this does not make sense. How in fact was the plaintiff harmed?
Under many group health plans, if you seek services from a non-network provider, the plan pays the provider according to the “UCR” rates (in this case, the Ingenix database). The provider, having no contractual arrangement with either the network or the patient, is free to seek reimbursement for the remaining balance directly from the patient.
Oftentimes the patient is not even aware they’ve used a non-network provider, particularly in cases of emergency services or surgeries, where, while the hospital may be contracted under the network, the hospital may refer lab work and x-ray interpretations to non-contracted providers; oftentimes the ER physician is not a network provider, either. In these situations, once the health plan makes payment at their “UCR” rate, the patient will receive a billing for the balance.
If the patient is not educated in how these arrangements work, they will likely continue to receive billings (including being turned over to collections) from the non-network providers until such time as they either pay the remaining balance OR contact their health plan. If the patient contacts their health plan, they will likely be told that they are not responsible for the balance as this is a ‘silent PPO’ (their term, not mine) situation where the patient had no way of selecting an in-network provider or knowing that a non-contracted provider was used. The health plan will then reprocess the billing for payment in full to the provider.
But remember – this is ONLY if the patient is smart enough to go back to their health plan and demand payment on these bills – the health plan will NOT notify the patient that this is the case.
The EOB received by the patient simply states that the payment to the provider is based on “UCR” rates and that since the provider is outside of the network, they patient is responsible for the difference. The health plan is just hoping the provider accepts the “UCR” payment initially made – if so, no harm, no foul to the patient. This appears to be standard industry practice and the health plans don’t seem to see anything wrong with it.
My guess is that the situation described above may be what has generated the losses suffered by the plaintiff in this case.
Ingenix – oh no they run the largest medi-cal data warehouse for the State of California. AKA Bull Services. Makes me wonder how much impact they have on a state that large.