UNH Arbitration Rulings on Unpaid Claims Could Have Significant Ramifications for Insurance Companies and Service Providers

An arbitration ruling in California has awarded Radiology Partners $154 from United Healthcare due to unpaid claims. In April 2022, Singleton Associates, an affiliated practice of Rad Partners, initiated an arbitration request, alleging substantial underpayments by UnitedHealthcare of Texas. According to court records, this imaging group based in Houston, Texas, has estimated that UHC’s breach of their agreement and the systematic underpayment of physicians have resulted in damages exceeding $100 million.

In response, United Healthcare filed a suit against Radiology Partners and alleged the company was orchestrating a pass-through billing scheme designed to defraud UnitedHealthcare, its customers, and members of tens of millions of dollars. They claimed the alleged unlawful scheme has been in operation since as early as 2014, where tens of thousands of claims to be improperly billed to United under network contracts, even when the in-network provider did not perform the underlying services being billed. The allegations include acquiring smaller radiology practices, such as Singleton Associates P.A., and then directing these practices to submit claims for services performed by unauthorized providers who were not shareholders, partners, or employees of the practices. The lawsuit alleged that Radiology Partners’ actions have led to United paying tens of millions of dollars in reimbursements to which Radiology Partners and its affiliated practices were not entitled.

In September, Radiology Partners had successfully obtained a motion to compel arbitration in response to a complaint filed by UnitedHealthcare (UHC). The California federal court has granted this motion and stayed UHC’s claims against RP, asserting that the insurer’s complaints were essentially identical to claims already being addressed in an existing arbitration between the two parties. The result of the arbitration panel was the $154 million award.

This announcement follows a similar verdict with Envision Healthcare who had claimed United denied 18% of claims prior to putting them out-of-network in 2021, and 48% of claims afterwards. An arbitration ruling in May of 2023 ruled that United Healthcare owed Envision $91 million on unpaid claims.

These rulings could have significant ramifications for insurance providers who deny claims without rationale and service providers who experience lost revenue. For instance, recently major insurance company CIGNA has faced allegations it broke state insurance laws by automatically denying claims without proper medical review using an automatic system reportedly that enables a single doctor to deny thousands of claims each month with a simple click. The allegations cite that Cigna doctors rejected over 300,000 payment requests using this method, spending an average of a mere 1.2 seconds on each case.