MultiPlan, a data analytics firm, works with UnitedHealthcare and many big insurers to calculate the amount insurers should pay for out-of-network care. As Chris Hamby reports for the New York Times, MultiPlan and the insurers make more money for themselves, the less they pay for employees’ care. So, many working people can’t trust their insurer to pay for their out-of-network care.
Are MultiPlan and the insurers simply “containing” costs for employers or profiting wildly at the expense of working people? Profiting wildly. The less they pay for workers’ out-of-network care, the more revenue they generate for themselves. In 2023, MultiPlan advised insurers not to pay $23 billion in health care bills they claim were provider overcharges.
How insurers benefit from out-of-network coverage, an example: The oncologist charges $100,000 for out-of-network care. MultiPlan says the appropriate charge is $5,000. The insurer pays $5,000. The employer saves. And, MultiPlan and the insurer receive a fee from the employer that is a high percentage of the “savings.”
What’s most insane about this whole scheme is that in many cases the fees that MultiPlan and the insurer collect are way more than the physician or hospital receives as payment for services from the insurer! UnitedHealthcare charges employers around 30 to 35 percent of the difference between what the provider bills and what the insurer pays. MultiPlan receives an additional fee. The cancer patient could be stuck with a $95,000 bill. The less the employer pays, the more MultiPlan and the insurer earn in fees.
How does MultiPlan calculate the insurers’ payment? Somehow, MultiPlan claims that the amount it determines to be the fair out-of-network rate is “defensible, repeatable and completely transparent” and independent of insurance company influence.” Orwellian, to say the least.
Don’t assume that your employer’s insurer doesn’t rely on MultiPlan. MultiPlan calculates out-of-network payments for more than 60 million people enrolled in 100,000 different health plans.
What must workers pay for their out-of-network care? They could be stuck paying whatever the difference is between what the insurer pays and the physician bills. They are also likely to forgo needed care down the road for fear of incurring more bills.
Who’s watching the store for workers? Honestly, no one. Regulators do not get involved with employer health plans, for the most part.
Fool me twice? 15 years ago, the New York Attorney General intervened to stop a similar UnitedHealthcare scheme: “A payment system riddled with conflicts of interest had been shortchanging patients, and at its core was a data company called Ingenix, a subsidiary of UnitedHealth.” They lower their payments to providers inappropriately. requiring patients to pay more. UnitedHealth paid $350 million and new regulations were put in place to prevent this from happening again.
Here’s more from Just Care:
- Corporate health insurers profit by condoning fraud
- Medicare Advantage: Combating fraud is a challenge because there’s no data on denied claims
- Whistleblowers expose fraudulent Medicare Advantage billing practices
- CVS charged with healthcare fraud
- Medicare Advantage plans are an “Insatiable Cash Monster”
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