Court Grants Preliminary Approval of Settlement in AMA’s Lawsuit Against UnitedHealth for Underpaying Physicians for Out-of-Network Services

The United States District Court for the Southern District of New York has granted preliminary approval of a $350 million settlement that would resolve a class-action lawsuit against UnitedHealth Group by the American Medical Association and others, according to an AMA news release.

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The action brought by the AMA, Medical Society of the State of New York and Missouri State Medical Association, along with several other plaintiffs, alleged that UnitedHealth Group colluded with others to underpay physicians for out-of-network medical services.

Originally filed in March 2000, the suit sought relief for physicians who were underpaid due to the insurer’s long-term use of the flawed database operated by Ingenix, a unit of UnitedHealth Group. A year-long investigation in 2008 by the New York Attorney General confirmed that the Ingenix database was intentionally rigged to allow insurers to shortchange reimbursements, according to the release.

The settlement is closely linked to a separate agreement between UnitedHealth Group and the New York Attorney General that creates a transparent replacement for the Ingenix database and trusts its operation to FAIR Health, a research network led by Syracuse University.

The court is expected to set a final approval hearing in the courtroom of the Hon. D.J. McKenna, United States District Judge.

Read the AMA release on the UnitedHealth settlement.

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