UnitedHealth class action settlement pays out $200 million to physicians

February 15, 2012

Out-of-network physicians who billed the insurer from 1994 to 2009 could recoup more than half of their lost payments. Even if you didn’t file a claim, you may be eligible.

The check is in the mail. Nearly $200 million will be paid to settle claims from physicians for years of low payments from UnitedHealth for out-of-network health services.

February 3, a federal court judge approved the distribution of the 2009 settlement that ended the court challenge led by the American Medical Association (AMA) and the New York State Attorney General’s Office against UnitedHealth Group.

Physicians who billed a UnitedHealth Group subsidiary as an out-of-network provider from March 15, 1994, to November 18, 2009, were eligible to receive funds from the settlement. Doctors needed to have submitted a settlement claim by October 5, 2010, to receive lost payments. The payout will vary from 50% to 90% of lost reimbursement depending on the doctor’s out-of-network patient volume and the collection efforts. Physicians who filed settlement claims with the required documentation should receive checks in a couple of months.

If you are a member of a group practice or an independent physician association, the organization may have filed a claim on your behalf without notice, so check with your manager. Physicians who filed claims and have moved since filing should provide their updated mailing address to ensure the delivery of their checks, according to the AMA.

In 2000, the AMA sued UnitedHealth for not fairly reimbursing out-of-network physicians, or its plan members, and basing its payment rates on a flawed database, which the company owned. Former New York Attorney General Andrew Cuomo’s office joined the suit. In 2009, UnitedHealth and several major insurers agreed on settlements and to fund a new, independent system to set usual, customary, and reasonable reimbursement rates.

The new system, called the FAIR Health database, is run by a nonprofit, independent organization that publicly reports the fair rate for out-of-network services, said AMA President Peter W. Carmel, MD, in a statement.

“Patients and physicians will be able to go online to see how much a particular service is likely to cost-and how much the insurer is willing to pay-before the patient even sets foot inside the doctor's office,” Carmel said.

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