Out-of-network deals prompt fraud accusations from payers

Out-of-network luxury healthcare providers are enticing patients by covering higher out-of-pocket costs, prompting legal retaliation from insurers that are seeing spikes in expensive claims, according to the Houston Chronicle.

Several boutique providers in Houston are at the center of an issue that has led major insurers to cut off reimbursement to some out-of-network providers altogether. After seeing a surge in claims from North Cypress Medical Center, Aetna found the hospital was charging patients in-network rates as opposed to the 40-50 percent co-pays patients typically pay for out-of-network care, and then, for example, billing Aetna as much as $200,000 to treat an abscess.

Last year, a survey from America’s Health Insurance Plans found the amount providers bill for out-of-network care varies considerably from state-to-state.

Aetna stopped paying the claims in 2011, and then brought a lawsuit against the provider seeking $225 million and alleging the hospital compensated physicians for patient referrals. A judge rejected those claims, but Aetna is appealing the ruling.

In a separate case in which Cigna stopped paying claims to a Texas-based five-bed surgical hospital because the provider negotiated “side deals” with patients, the same judge ordered the insurer to pay nearly $14 million in back claims and penalties. Cigna is also appealing that decision.

In April, a jury ordered a California surgery center to pay Aetna $37.4 million after the insurer said the provider waived patient co-pays in order to submit exorbitant out-of-network claims. Earlier this month, UnitedHealth filed a lawsuit claiming a dialysis provider paid patient premiums in order to bill the insurer elevated out-of-network rates.

- read the Houston Chronicle article