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Some health care providers have been trying to fight much harder against health insurer and health plan claim administration teams.
Now, those providers face a new kind of counterattack: shareholder derivative suits.
Juan Camilo Jimenez, an investor in Nutex Health, a publicly traded health care provider, has filed a shareholder derivative complaint against Nutex in the U.S. District Court for the Southern District of Texas.
Jimenez is suing Nutex executives, on behalf of Nutex shareholders, over allegations that Nutex "failed to maintain internal controls" when it hired HaloMD to handle out-of-network claims under the federal No Surprises Act because, according to Jimenez, "HaloMD engaged in fraudulent contact to achieve substantial arbitration results for Nutex," and the extra revenue obtained by HaloMD through arbitration was unsustainable.
HaloMD increased cash obtained through No Surprises Act arbitration by "engaging in a coordinated fraudulent scheme" that involved flooding the No Surprises Act billing dispute arbitration system with "thousands of claims that the knew at the time of submission to be ineligible," Jimenez asserts in the complaint, citing a report issued by Blue Orca Capital.
Jimenez is accusing Nutex executives of violations of federal securities laws, breach of fiduciary duty, gross mismanagement and abuse of control, and he's asking the court to make the executives pay Nutex damages, make Nutex change the way it operates and let shareholders nominate at least four candidates for election to the Nutex board, according to the Jimenez complaint.
The No Surprises Act is a federal law that's supposed to protect patients with health insurance from some types of unexpected medical bills, by requiring providers and plans to fight it out with each other over the disputes that occur when a patient seeks emergency care in an out-of-network hospital or ends up getting care from out-of-network providers in an in-network hospital.
Federal and state regulators have created "independent dispute resolution" arbitration programs to handle the No Surprises Act claim disputes.
Nutex runs "micro hospitals," which are similar to stand-alone emergency rooms but can often bill insurers using different billing rules, and population health management programs, or efforts to provide primary care, support services and other services for the enrollees in a health plan. It works with employer plans as well as treating public plan enrollees.
HaloMD has offered to help physicians and hospitals cope with what they see as unfair insurer and plan administrator efforts to "reprice" out-of-network claims, or apply discounts to claims from providers who have signed no contracts requiring them to accept discounted reimbursement rates.
Elevance and other insurers have already sued health care providers and HaloMD over HaloMD's efforts to help providers negotiate with payers over out-of-network claims.
Related: Elevance sues medical services firms over 'fraudulent' out-of-network care billing
A shareholder derivative suit is different, because it focuses on trying to punish individual company executives and changing how a company operates, rather than on getting cash back from a company accused of harming the plaintiffs.
Representatives for Jimenez and Nutex did not immediately respond to a request for comment.
A representative for HaloMD rejected the allegations in the Jimenez complaint.
"These claims are drawn from Blue Cross's continued lawfare attacking the No Surprises Act, its patient protections and the one company defending fair reimbursement for physicians, HaloMD," the HaloMD representative said. "We'll be contesting these claims to the full extent of the law as we continue fighting for doctors to be paid fairly for the care they deliver."
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