Medical Providers File Antitrust Lawsuit Against Blockchain Healthcare Firm MultiPlan, Health Insurers Over Alleged Out-of-Network Price Fixing Scheme
On Thursday, July 25, 2024, Mehrnaz Jamali MD, Inc. filed an antitrust class action lawsuit against MultiPlan Inc. and several major health insurance companies in the US District Court for the Northern District of California.
The class action complaint, which seeks damages and injunctive relief under federal antitrust laws, alleges that the defendants engaged in an illegal price-fixing scheme to suppress reimbursement rates paid to out-of-network healthcare providers across the country.
MultiPlan, a healthcare technology company that works with industry-leading healthcare firms to help advance the transmission of data through allocation modeled blockchain efforts, is accused of facilitating a cartel among dominant health insurers like UnitedHealth Group, Aetna, Cigna, and others by using its data analytics tool to collectively determine and apply artificially low rates for out-of-network medical claims.
Mehrnaz Jamali MD, a stock corporation incorporated in California that provides high-quality, often life-saving primary care treatments to its patients to help prevent stroke, heart failure, and other conditions, is the lead plaintiff representing a class of all healthcare providers in the US who have received reimbursements for out-of-network services since July 2017. The complaint claims that MultiPlan’s repricing algorithms incorporate proprietary data from insurers and apply artificial caps on reimbursement rates, which effectively collude to eliminate competition in out-of-network pricing.
By pooling claims data and repricing methodology, MultiPlan and its co-conspirators are alleged to have erased insurer competition for access to out-of-network providers. This is argued to violate antitrust laws by fixing prices below what would result from independent and competitive insurer behavior. The lack of competitive options leaves providers with no meaningful ability to negotiate rates upwards.
The lawsuit further argues that MultiPlan has a direct financial incentive to lower rates paid to providers, as its fees from insurers are calculated as a percentage of the difference between initial claims and final payments. This is in contrast to independent organizations like FAIR Health, which charge flat annual membership fees.
The effects of suppressed out-of-network reimbursements have reportedly led to the closure of many hospitals and medical practices across the US in recent years. Rural healthcare access has been disproportionately impacted. If successful, the antitrust class action seeks monetary damages for impacted providers and injunctive relief to prevent the continued operation of the alleged price-fixing scheme.
Please contact BlockTribune for access to a copy of this filing.
