NY hospitals sue UnitedHealth, claim racketeering

A pair of New York hospitals--Flushing Hospital Medical Center and Jamaica Hospital Medical Center--have filed a Racketeer Influenced and Corrupt Organizations (RICO) suit against health insurer UnitedHealth. The suit is unusual in that RICO suits are typically used as a tool by public prosecutors in their war against against gangland activity. But that hasn't stopped the two hospitals, which are seeking at least $50 million in punitive damages and millions more in actual damages.

The suit is a result of long-standing bad blood between the hospitals and UnitedHealth; the hospitals already sued UnitedHealth last year in New York's state court, basing their claim on similar assertions. In both cases, the hospitals' central contention that UnitedHealth and subsidiary Oxford systematically told patients that the hospitals weren't in their networks, scaring away significant amounts of business. The hospitals had already been in contract disputes with UnitedHealth.

For more information on the lawsuit:
- read this Hartford Courant piece

Related Article:
NY hospital battles Oxford Health. Report
UnitedHealth Group faces criminal inquiry. Report

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