A lawsuit has been filed against major insurers, including Elevance and UnitedHealthcare, by orthopedic providers, alleging their involvement in a price-fixing scheme.
The lawsuit claims that these insurers colluded with MultiPlan to suppress payment rates for out-of-network services. The plaintiffs argue that this alleged conspiracy undermines the financial viability of out-of-network providers. The lawsuit seeks class action status, a jury trial, and a judicial determination that the insurers" conduct is unlawful, along with a demand for restitution.
MultiPlan, a key player in the healthcare insurance industry, is accused of facilitating this alleged price-fixing scheme by acting as a common entity for rate-setting among insurers. The complaint highlights that out-of-network claims are not processed based on pre-negotiated rates but rather on the provider"s retail charges. This practice is particularly concerning for patients enrolled in preferred provider organization (PPO) plans.
The lawsuit outlines a collective action problem faced by insurers, where their individual interests in competing for out-of-network services conflict with a shared goal of minimizing payments to providers. By outsourcing rate-setting to MultiPlan, insurers are said to have circumvented antitrust laws, allowing them to collectively suppress compensation rates. The complaint alleges that approximately 700 of the nation"s insurers, including all 15 of the largest, have engaged in this practice.
Central to the allegations is MultiPlan"s proprietary program, Data iSight, which is claimed to determine out-of-network compensation rates algorithmically. However, the plaintiffs argue that this technology serves as a cover for traditional price-fixing practices. By sharing sensitive pricing information and payment data with MultiPlan, insurers are accused of enabling a system that suppresses compensation rates across the industry.
The financial implications of this alleged scheme are significant. MultiPlan"s revenues from its repricing services have increased dramatically over the years. This raises questions about the sustainability of such practices and their impact on healthcare providers who rely on fair compensation for their services.
The outcome of this lawsuit could have far-reaching implications for how out-of-network services are compensated and may challenge the practices of major insurers in the healthcare market. It could also influence the broader landscape of healthcare access and affordability for patients.