UnitedHealthcare Pays $91.2M After Underpaying Envision for Medical Care

After underpaying the medical group for essential care, UnitedHealthcare has been ordered to pay $91.2 million to Envision Healthcare (Envision).

An independent three-member panel of the American Arbitration Association came to the decision on March 30, 2023. The $91,270,257 award concerns care that Envision provided to UnitedHealthcare members in 2017 and 2018.

The medical group and the payer had an in-network agreement at the time, but UnitedHealthcare allegedly unilaterally reduced reimbursement to Envision clinicians, violating their agreement. The award compensates Envision for UnitedHealthcare’s breach of contract.

“This decision sets a critical precedent for insurers like UnitedHealthcare to pay in full for the high-quality care its members receive in their most acute time of need,” Jim Rechtin, chief executive officer of Envision, said in the press release. “While we are disappointed that we had to take the step of entering into arbitration to compel UnitedHealthcare to pay its bills, we are satisfied with the panel’s decision against UnitedHealthcare and its systematic underpayment to clinicians for the care they provide.”

The arbitration panel will also assess prejudgment interest and decide Envision’s entitlement to attorney’s fees, costs, and expenses.

“We currently have three other lawsuits against UnitedHealthcare, which will likely take several more years to resolve,” Rechtin added. “It is challenging to create a stable environment for our teams when health plans choose not to pay their bills.”

One ongoing lawsuit, filed in the US federal court in Tennessee in September 2022, claims that UnitedHealthcare pushed Envision clinicians out-of-network in January 2021 and began routinely denying commercial claims related to emergency room care.

The lawsuit referenced specific situations in which the payer denied claims, including a 31-year-old man who required an emergency appendectomy and a 2-month-old baby with unexplained episodes of choking, vomiting, and turning blue.

The lawsuit alleges that after UnitedHealthcare removed Envision from its network, the payer denied 18 percent of commercial claims submitted by the medical group. The share increased in November 2021 to 48 percent of all claims submitted. According to Envision, the payer automatically denied 60 percent of commercial claims submitted for the highest-acuity care.

UnitedHealthcare responded with a countersuit, alleging that Envision exaggerated the complexity and expense of treatment by using improper current procedural technology (CPT) codes, known as upcoding.

Another payer recently faced a dispute over reimbursement issues, though the situation had a more amicable outcome.

Regional health system Valley Health filed a lawsuit against Anthem Blue Cross and Blue Shield, now known as Elevance Health, in October 2022. Valley Health sought to recoup $11.4 million in past-due payment that it claimed Anthem contractually owed to the health system.

However, Valley Health abandoned the lawsuit after it spent several months working with Anthem in good faith to reach a settlement. The two organizations plan to extend their current contract, which ends on December 31, 2023.