California Physicians Eligible for Shares in UnitedHealth Settlement
California physicians are eligible to collect shares of a $350 million settlement with UnitedHealth Group. The settlement is the result of a class action lawsuit filed in 2000 by AMA and other health care provider and patient groups.  The lawsuit alleged that United conspired to defraud consumers by manipulating usual, customary and reasonable (UCR) rates so as to artificially reduce out-of-network reimbursement rates, thereby shortchanging physicians and patients by hundreds of millions of dollars over the past 15 years.

The deadline to submit claims for payment from the settlement fund is October 5. Physicians are eligible to file for damages if they provided covered out-of-network services or supplies between March 15, 1994, and November 18, 2009, to patients covered by UnitedHealth or its subsidiaries, including PacifiCare. Physicians may recoup underpayments for out-of-network services provided to PacifiCare subscribers at any time during the claim period, even before PacifiCare became a subsidiary of United.

Shares to physicians will be calculated based on their total "recognized loss" between 1994 and 2009, which is the difference between a physician's billed amount and the "allowed amount" that United actually paid for covered out-of-network services. In the total amount of submitted claims from all physicians exceeds the $350 million settlement fund, physicians will receive a pro rata share based on their total recognized loss. United has submitted data to the claims administrator showing all the payments it made (i.e., the allowed amounts) for covered out-of-network services from January 1, 2002, to May 28, 2010. Physicians can request a copy of their own claims data from the claims administrator. It may take several weeks to receive the report, so the sooner you request your copy, the better.

To help physicians better understand the settlement and what they need to do to claim their share, CMA has created a settlement resource center where you will find CMA's United Healthcare/Ingenix Settlement Guide, claim forms, and a number of other helpful resources.

Click here to access the United Healthcare/Ingenix Settlement Resource Center.

If you have questions, please call the ACCMA at 510-654-5383.

United Healthcare and Ingenix Settlement:
What to Know, Where to Find More Resources
prepared by the California Medical ASsociation
(Click here for a Printable Version)

For years, United Healthcare Corp. and other major insurers relied on the Ingenix database to calculate the market rates for physicians who provided out-of-network care.

But the database, owned and operated by United Healthcare, manipulated data to intentionally low ball the rates, according to state and federal authorities who investigated in 2008.

The result was that doctors providing out-of-network services were systematically underpaid by United, and often patients ended up paying some of the cost not covered by the insurer.

In 2009, United reached a legal settlement with authorities to abandon Ingenix and pay $50 million for the creation of an independent agency to more accurately assess market rates for health care services. Once that independent database is established, United must use it to determine reimbursement for out-of-network services for at least five years.

United and Ingenix also settled class action lawsuits brought by patients and providers, essentially agreeing to pay $350 million to compensate for the underpayments. As part of that process, physicians must decide by July 27, 2010, whether to participate in the settlement or opt out or object. By opting out, a physician could sue United directly for damages caused by Ingenix but could not make a claim for funding through the class action settlement fund.

A court hearing is scheduled for Sept. 13 to approve the final United settlement. Those participating will have until Oct. 5 to submit claims for payment. To qualify, physicians must have provided - and billed for - out-of-network care covered by the insurer to a patient enrolled in United or one of its affiliates anytime between March 15, 1994 and Nov. 18, 2009. This includes services to patients covered by PacifiCare.

Physicians' settlement amounts will be determined by a number of factors. However, in general, the amount will be the difference between the UCR value of the service provided and the amount prescribed by the Ingenix database. Settlement checks will be processed and delivered after Oct. 5, when all claims are due.

CMA has set up an online resource center to help physicians understand the terms of the settlement and what they need to do to opt out, object or submit claims for payment. Click here to find a detailed guide to the settlement agreement, claim forms and other helpful documents.

Significant Dates

• July 27, 2010 – Deadline for class members to opt out or object to the settlement.
• Sept. 13, 2010 – Court hearing to approve the final settlement.
• Oct. 5, 2010 – Deadline to submit claims for payment from the settlement fund.