The American Medical Association (AMA) and the Illinois State Medical Society (ISMS) have filed a lawsuit against MultiPlan, accusing the data analytics firm of participating in a price-fixing conspiracy with commercial health insurance companies.

The lawsuit alleges that MultiPlan's actions have harmed patients and physicians by undermining fair payment for out-of-network healthcare services and stifling market competition.

Impact on Patients and Physicians

The AMA claims that physicians have been forced to accept lower payments for out-of-network services, leading to the closure of medical practices and reduced options for patients.

The lawsuit seeks to hold MultiPlan accountable for its alleged role in a price-fixing scheme that has been ongoing since around 2015.

Concerns about Payment Discrepancies

The AMA's review of data published by the Office of the New York State Comptroller in April 2020 found that payments based on MultiPlan's repricing methodology were significantly lower than those calculated using traditional methods.

This raises concerns about the sustainability of medical practices and the quality of care available to patients.

Financial Incentives and Increased Revenues

MultiPlan's business model creates a financial incentive to suppress out-of-network payment rates, as the company receives a fee based on the difference between the initial claim amount and the amount paid by the insurer.

The AMA reported a significant increase in MultiPlan's revenues, highlighting the financial stakes involved in the dispute.

Scrutiny of Algorithmic Pricing Tools

The lawsuit against MultiPlan comes at a time of increased scrutiny of algorithmic pricing tools used by health insurers.

Senator Amy Klobuchar has called for an investigation into these practices, specifically mentioning MultiPlan, due to concerns about their impact on competition among insurance companies and the potential for increased costs for employees and patients.

Advocating for Reform

MultiPlan serves as a central hub for gathering out-of-network payment data, and the use of algorithmic tools may lead to collusion among insurance companies.

The AMA and ISMS are advocating for reform to out-of-network payment systems to eliminate reliance on MultiPlan's pricing scheme.

Implications for Payment Structures

The outcome of the lawsuit could have significant implications for payment structures and the availability of services for patients seeking out-of-network care.