Send Lawyers, Guns and Money Part III
The American Medical Association recently oined the fray and sued Multiplan earlier this week in federal district court in Chicago. At issue is MultiPlan’s business model. Instead of determining their own out-of-network rates, insurers can outsource that function to MultiPlan, which promises to save them money on those claims. In many cases, MultiPlan uses an algorithm-based tool to recommend a payment level — and receives a portion of the difference between the recommendation and the original out-of-network bill, giving the company a financial incentive to recommend lower rates. The majority of U.S. insurers, including the 15 largest in the country, use MultiPlan to determine out-of-network payments.
Takeaway:
With the AMA joining the hospitals and calling Multiplan a monopoly is a lot like calling the kettle black. All the hospitals have to do is charge a reasonable amount for their services and Multiplan would cease to exist. Multiplan is the only nationally organized and coordinated effort by health insurers to combat excessive hospital pricing. If Multiplan is litigated out of existence and repricing facility claims becomes increasingly difficult, we are all screwed absent reasonable free market reforms or a flat out government takeover.
