Yesterday I wrote about a pharmaceutical industry practice that is potentially costing Americans billions of dollars. Now Congressional investigators have brought to light an issue involving insurance companies that has also cost Americans billions. The issue: two-thirds of health insurance companies used an incorrect database that resulted in patients being overcharged for out-of-network care, which has totaled in the billions of dollars.
When patients go out-of-network, insurers generally pay a percentage of the “customary” rate, but the majority of them were basing these rates off faulty databases. The databases in question are owned by Ingenix Inc., which is a part of UnitedHealth Group Inc, a large insurance company. Ingenix is accused of altering the data used to calculate those customary rates, thus allowing insurers to underpay, and forcing patients to pay more than they should. Earlier this year, Ingenix settled with the NY attorney general for underpaying hospitals and doctors for out-of-network care. There’s an overall lack of transparency that leads to this type of activity, and hopefully more legal action, like that of the NY attorney general’s office, will bring other schemes to light.
See coverage in the NY Times, Wall St Journal, and Washington Post.
