ALBANY, NY – In mid-February, New York Attorney General Andrew Cuomo announced an industry-wide investigation involving health insurance companies and Ingenix, which Cuomo said has been providing payers with faulty data for reimbursement rates.
The investigation is “ongoing,” and the Attorney General’s Office is in “some discussions,” assured communications director Jeffrey Lerner.
Lerner did not disclose with whom Cuomo is in discussions. Nor did he care to comment on a statement issued March 6 by Karen Ignagni, president and CEO of America’s Health Insurance Plans.
Ignagni charged the Attorney General’s Office with misguided focus on “increasing reimbursements to the small number of physicians who do not participate in health plan networks and charge rates that are more than double what Medicare pays.” She concluded, “New Yorkers deserve to know whether these actions will push medical costs even higher.”
The focus of the investigation, however, is not on the overpayment of physicians but on the consistent underpayment of consumers for out-of-network medical expenses through health plans’ alleged manipulation of data used to determine a “reasonable and customary” rate for individual claims.
At the February announcement, Linda Lacewell, head of the Attorney General’s healthcare industry task force, noted that reimbursement rates produced by Ingenix were lower than the actual cost of typical medical expenses, resulting in significantly higher out-of-pocket expenses for consumers. The focus, therefore, on the investigation is on the defrauding of consumers for the right to fair payment.
Lacewell pointed out the conflict of interest by health plans in supplying Ingenix, which itself is owned by United HealthGroup, with billing data that would then be used to set rates for consumers.
Lacewell further charged that Ingenix does not conduct audits of data received and knowingly deleted data that would have impacted the rates and no independent research of the data is conducted.
While Ignagni spoke on behalf of the payers, other healthcare organizations have applauded Cuomo’s investigation, including Consumers Union Programs, Families USA, the Medical Society of the State of New York, Cancer Care and the American Medical Association.