AMA and ISMS File Antitrust Lawsuit Against MultiPlan Over Alleged Price-Fixing Scheme

In a significant legal move aimed at addressing rising concerns in the healthcare industry, the American Medical Association (AMA) and the Illinois State Medical Society (ISMS) filed a lawsuit today against MultiPlan, a data analytics agency, accusing it of orchestrating a price-fixing conspiracy in collaboration with commercial health insurers. The lawsuit, filed in the Northern District of Illinois, alleges that this conspiracy has undermined fair payment practices for out-of-network healthcare services, leading to a reduction in market competition and harming both patients and physicians.

The lawsuit centers on claims that since around 2015, MultiPlan has been at the forefront of a scheme that pressures physicians to accept drastically reduced payment rates for out-of-network services. This has led to significant financial strain on healthcare providers, especially smaller practices, many of which have been forced to shut down or limit the scope of their services. According to a ForexTV report, the lawsuit contends that the price suppression practices have left patients with fewer healthcare options, further exacerbating issues such as long wait times and rising costs in the already stressed healthcare system.

“MultiPlan’s pricing scheme does not generate any savings for patients,” said AMA President Bruce A. Scott, M.D., in a statement. “The cost of health insurance keeps going up, while the payors, their investors, and their executives profit from money that should have rightfully been paid to doctors providing necessary medical care.” Scott emphasized that the lawsuit highlights a broader issue of insurance companies prioritizing profits over patient care, a sentiment shared by many healthcare professionals and patients alike.

Per ForexTV, a 2020 study from the Office of the New York State Comptroller revealed that MultiPlan’s repricing methodology led to payments for out-of-network services being anywhere from 1.5 to 49 times lower than traditional payment methods. This disparity, the lawsuit claims, has not only hurt physicians but also compounded problems in the healthcare system, leaving patients with fewer choices and contributing to the inefficiencies and rising costs that frustrate so many.

The ISMS, standing firmly with the AMA, is also calling for reform. ISMS President Piyush I. Vyas, M.D., said, “This activity has resulted in below-market reimbursement rates paid to physicians for out-of-network healthcare services. The lack of transparency on how these fees are calculated, along with the payment structure, needs to be fixed.” Vyas emphasized that fair compensation for physicians is vital to ensuring the availability of quality healthcare for patients.

The lawsuit further details how MultiPlan benefits financially from its repricing services, which, according to the complaint, incentivize lower payments to physicians. MultiPlan receives a fee based on the difference between the initial claim amount and the reduced payment made by the insurer, creating what the AMA and ISMS argue is a direct conflict of interest. The company’s revenues from these practices have surged dramatically, from $23 million in 2012 to $709 million in 2021, per court filings.