ER physicians accuse UnitedHealth of illegally underpaying claims

Several emergency room physician practices in New York have filed a federal lawsuit alleging UnitedHealth Group and MultiPlan conspired to underpay out-of-network ER providers. 

In their federal complaint, filed Oct. 30, five ER physician groups allege UnitedHealth failed to pay them the “reasonable” rate for out-of-network claims. The physicians are legally entitled to the “reasonable” rate for their services, which is the “usual and customary rates” for similar providers in the same area. 

The lawsuit claims UnitedHealth used data from MultiPlan’s Data iSight software to support underpaying out-of-network claims. 

The physicians’ lawsuit asserts claims under the federal Racketeer Influenced and Corrupt Organizations Act and New York state law. The physicians are seeking monetary, injunctive and declaratory relief.

In a statement to Becker’s Hospital Review, UnitedHealth says it believes the lawsuit is “meritless.” 

“A small number of providers, and especially private equity-backed physician staffing companies like TeamHealth, are driving up the cost of care for the people and customers we serve. Some of the TeamHealth provider groups that are not part of our network today charge 700-900% of Medicare rates for the care they provide,” UnitedHealth said. “This sort of excessive pricing from out-of-network providers contributes to skyrocketing health care costs for everyone. TeamHealth has filed a lawsuit in an attempt to challenge our efforts to address the unreasonable and anticompetitive rates its providers charge. We believe the lawsuit is meritless and plan to aggressively defend ourselves against TeamHealth’s baseless claims.”

The allegations in the case are similar to those brought in September by two hospital-based physician groups. In a complaint filed Sept. 15, Emergency Care Services of Pennsylvania and Emergency Physician Associates of Pennsylvania allege UnitedHealth hired a data analysis firm to develop market-based reimbursement rates. However, the plaintiffs allege the tool used to come up with the rates, Data iSight, doesn’t use information about services or rates in local markets. 

“It does not use the local information it purports to, and exists simply to paper over the naked, unexcused, and illicit greed of the United defendants, whose growth in profit comes at the direct expense of front-line emergency room physicians,” states the complaint. 

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