Health insurer’s database gets overhaul

Sarah Gardner Jan 13, 2009
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Health insurer’s database gets overhaul

Sarah Gardner Jan 13, 2009
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TEXT OF STORY

SCOTT JAGOW: Today, New York’s Attorney General Andrew Cuomo announced a big settlement with health insurance companies. United Health Group has agreed to spend $50 million to create a new database. It’ll help determine patient reimbursement rates.

Cuomo had accused United Health Group of manipulating the numbers and overcharging millions of people. The settlement could affect other major insurers. Sarah Gardner reports.


SARAH GARDNER: Millions of insured Americans go out of network to get what they think is the best care. United Health said it used an independent database to determine reimbursements. But after patients complained of stingy payouts, Cuomo’s office started investigating. Turns out United Health owns the company that operated that database. It’s called Ingenix.

Nancy Nielsen, president of the American Medical Association, says insurers typically promise to pay a hefty percentage of out-of-network costs.

NANCY NIELSEN: So then they go out of network expecting that the bill is going to be 80-percent paid by the insurer. And what they find out is, Oh no, it’s not the bill, it’s what we think the bill ought to be. That’s the dilemma.

Under the settlement, Ingenix will close and United Health will fund a new, independent database run by a nonprofit.

Andrew Cuomo:

ANDREW CUOMO: A company that’s not owned by the insurance industry, not controlled by the insurance industry, not manipulated by the insurance industry, not part of a virtual monopoly of the insurance industry, but a fair company.

United Health denied it manipulated reimbursement data.

Today, an insurance trade group said this controversy sheds light on one reason for rising medical costs — wide disparities in what out-of-network doctors charge. This settlement has national implications since many other health insurers use Ingenix too.

I’m Sarah Gardner for Marketplace.

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