UnitedHealth Group will pay $350 million to settle a class-action lawsuit brought by the American Medical Association on behalf of physicians and patients alleging the companys health plans used flawed data administered by its subsidiary Ingenix to justify low reimbursement for out-of-network care.
The proposed agreement contains no admission of wrongdoing. It comes two days after a separate deal was announced between UnitedHealth and New York Attorney General Andrew Cuomo requiring Ingenix to discontinue the databases and turn them over to a university that will establish an independent, not-for-profit substitute. UnitedHealth will contribute $50 million to the effort. The Ingenix products are used by many insurers, such as Aetna, which has agreed to contribute $20 million toward the new data source and be a subscriber when its available, settling any claims the attorney general might have against the company. Aetna likewise admits no wrongdoing.
By agreeing to the settlement, UnitedHealth Group has recognized the importance of restoring its relationship with patients and physicians by ending use of a rigged database, AMA President Nancy Nielsen said.
In a news release, UnitedHealth said it believed the two agreements should completely resolve the issues raised in the lawsuit and Cuomos investigation. Cuomo, meanwhile, said he will continue looking into similar practices by UnitedHealths peers. (For a longer version of this story, please click here.) -- by Gregg Blesch