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A federal court judge ruled Tuesday that health care providers can move ahead with two waves of lawsuits against MultiPlan — big health care provider network manager — and MultiPlan's health plan customers.
Many large health plans have used MultiPlan systems to take in claims for plan participants who received care from out-of-network providers. MultiPlan decided how much the plans paid the providers for the out-of-network claims.
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U.S. District Judge Matthew Kennelly rejected a motion filed by the defendants that asked him to dismiss the case.
Kennelly ruled that, if what the providers have said is true, the health plans may have used MultiPlan's out-of-network claim repricing service to find out what competitors were paying and to align their own out-of-network reimbursement rates with competitors' rates.
Helping health plans align their reimbursement rates that way could be a form of price-fixing that would violate federal and state antitrust laws and state consumer protection laws, Kennelly wrote in an opinion explaining his ruling.
Kennelly said that his ruling does not necessarily mean that the facts in the plaintiffs' allegations are correct.
"At the motion to dismiss stage, the court accepts all well-pled factual allegations as true," Kennelly wrote in the opinion.
The parties' views: Four attorneys — Matthew Lavin of Arnall Golden Gregory; Christopher Seeger and Jennifer Scullion of Seeger Weiss; and Hunter Shkolnik of Napoli Shkolnik — are helping to represent the "direct action plaintiffs," or plaintiffs that have filed their own, separate suits, rather than participating in class-action suits.
"The facts are clear: MultiPlan and its co-conspirators, the largest insurers in the country, orchestrated a cartel through the sharing of competitively sensitive confidential pricing information to illicitly coordinate on out-of-network reimbursements, devastating medical practices, undermining patient care, and siphoning billions of dollars from the healthcare system," the direct action plaintiffs said in a statement about the new ruling. "MultiPlan has long claimed its mission is to bend the health care cost curve for all. For too long, it has bent that curve in the favor of payers, systematically under-reimbursing providers. The court's ruling allows our case to proceed as we take discovery and challenge these practices on behalf of our clients.”
MultiPlan recently changed its operating name to Claritev.
Claritev said in a statement that it looks forward to presenting the facts as the case moves forward.
"Claritev has always upheld the highest standards of integrity and transparency, operating in full compliance with all applicable laws and regulations," Claritev said. "We remain confident that the facts will reinforce what we've consistently said — that these lawsuits are without merit and fail to acknowledge the critical role our competitive options play in reducing health care costs for employers and improving access for patients. These lawsuits will only serve to increase health care cost for employers and patients. We will vigorously defend ourselves through the legal process while remaining focused on delivering value to our customers and the broader health care ecosystem."
The next steps: Kennelly asked the parties to agree on a schedule for "discovery" and other pretrial proceedings by June 10.
The discovery process gives the parties in a lawsuit a chance to get records and other information from each other.
The parties are supposed to hold a video case management conference June 17.
The backdrop: Kennelly, a judge in the U.S. District Court for the Northern District of Illinois, is presiding over In re MultiPlan Health Insurance Provider Litigation.
In re MultiPlan is a "multidistrict litigation" proceeding, or MDL.
The courts established the MDL to handle a torrent of lawsuits filed by providers who were angry about MultiPlan's repricing strategy.
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The providers have accused MultiPlan and the health plans, including many health coverage providers that were acting as administrators for employers' self-insured health plans, of conspiring to underpay providers by about $19 billion per year.
MultiPlan and the health plans have argued that they are using public data to fight skyrocketing health care costs.
Officials in the U.S. Justice Department said in March that they would support the providers.
Opinion details: Kennelly noted that the defendants say the plaintiffs have not asserted a viable federal antitrust claim partly because they have not plausibly alleged that they have suffered a direct injury.
"The defendants argue that providers are not directly injured by the alleged third-party payor agreement to fix prices because they can always seek full payment from the patient," Kennelly wrote.
In this case, however, the providers have agreed to accept MultiPlan's repricing and not bill the patients for any unpaid portions of the bills, Kennelly wrote.
The defendants have also argued that the prices the providers have been getting have been reasonable, but "price-fixing agreements between competitors cannot be justified at all, let alone by the argument that currently-fixed prices are more 'reasonable,'" Kennelly said.
Even if a price-fixing agreement seems to lower consumer prices, it "cannot be justified, period," Kennelly added.
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