NYC Health + Hospitals looks to claw back $11.5M in wrongful denials from UnitedHealthcare

NYC Health + Hosptials says UnitedHealthcare improperly denied $11.5 million in claims, mostly tied to ED services. (Getty/jetcityimage)

The largest public hospital in the country will pursue arbitration with UnitedHealthcare to recover $11.5 million in wrongful denials, mostly from emergency department claims.

New York Health + Hospitals says the insurer wrongfully denied claims between July 1, 2014 and December 31, 2017 for inpatient services. The health system is reviewing its current managed care contracts and denials and “may pursue arbitration against other health insurers” to collect on denied claims, according to an announcement 

Most of the claims in question originated in the ED and most of the beneficiaries are covered by UnitedHealthcare’s Medicare or Medicaid business, New York Health + Hospitals spokesperson Robert de Luna told FierceHealthcare. None of the denials are associated with behavioral health or ambulatory care.

He added that the system’s contract with UnitedHealthcare doesn’t allow the insurer to deny claims by “second-guessing” the medical judgment of providers.

“For too long, NYC Health + Hospitals has been leaving money on the table and subsidizing private insurance companies by letting denials slide,” Mitchell Katz, M.D., president and CEO of NYC Health + Hospitals said in a statement. “Our clinicians provide high-quality care and advance our mission every day.  It’s our responsibility to stand up for them and challenge wrongful denials, as all health systems should.”

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The NYC Law Department will oversee the arbitration this summer.

Matthew Siegler, senior vice president for managed care and patient growth added pursuing arbitration is a “new approach to working with our managed care partners.”

“Negotiating fair rates and terms with private insurance companies and collecting accurate payment for services rendered are critical elements of those relationships,” he added.

In an emailed statement to FierceHealthcare, a UnitedHealthcare spokesperson said the insurer “appreciates” it’s relationship with the hospital.

“While we disagree with their view on these claims, arbitration will give us the opportunity to resolve outstanding disputes,” the statement read.

Historically, NYC Health + Hospitals has provided most of its care to uninsured patients. But policy shifts tied to the Affordable Care Act, which reduced the uninsured rate and expanded Medicaid, have forced the system to strengthen its billing processes and systems. The system is now looking more closely at denials and plans to seek arbitration when necessary.

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The news comes months after UnitedHealthcare implemented a new policy to closely evaluate emergency department claim submissions. Anthem made similar controversial changes to its ED policies meant to deter patients from accessing the ED unnecessarily.  Providers previously warned that Anthem’s revised policy may violate federal law.

But de Luna said the arbitration request is more about the system's emphasis on reviewing denied claims than any policy changes from insurers.

“It’s less about a change on UnitedHealthcare’s side and more about a change in our side and trying to make sure we’re recovering funds that are appropriately claimed for services rendered and not leaving money on the table,” he said.