A managed care company has agreed to turn a business that publishes medical procedure cost estimates widely used in out-of-network billing over to a university or other nonprofit organization.
UnitedHealth Group Inc., Minnetonka, Minn., will be divesting Ingenix Inc. in connection with efforts to settle an investigation launched by New York Attorney General Andrew Cuomo in February 2008.
Many health insurers use the Ingenix medical services price database to decide how much they should pay out-of-network doctors for medical care.
Cuomo says some have alleged that Ingenix staffers intentionally used faulty data collection and pooling procedures to depress the “usual and customary” rates stored in the database.
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The Cuomo agreement calls for UnitedHealth to pay $50 million to a “qualified nonprofit organization that will establish a new, independent database to help determine fair out-of-network reimbursement rates for consumers throughout the United States,” according to officials in Cuomo’s office.
The new nonprofit price database organization will post price information on a free Web site, officials say.
“For the past 10 years, American patients have suffered from unfair reimbursements for critical medical services due to a conflict-ridden system that has been owned, operated, and manipulated by the health insurance industry,” Cuomo says in a statement. “This agreement marks the end of that flawed system.”