UnitedHealth Emails Reveal Tension Over Doctor Pay Cuts

(Bloomberg) — UnitedHealth Group Inc. systematically cut the fee it pays for emergency room visits and mental health care to doctors outside its network, causing internal tension over how those changes were handled and the potential impact on members, newly unsealed court documents show. It shows that it is opened.

The records provide a window into the workings of the unit of UnitedHealthcare, the largest U.S. health insurer, and shed light on the bitter battle between financial heavyweights in the $5 trillion U.S. health care system. Doctors have long accused the company of refusing to fully cover their bills; Private equity-backed physician groups are filing a series of lawsuits accusing the company of shortchanging clinicians from outside its insurance network.

Although years of disagreements over out-of-network billing led Congress to pass legislation protecting patients, the reforms have not eased fights over how much to pay for medical claims. Doctors who have not made an agreement with insurance companies are free to charge whatever fee they want for these services. Insurers may refuse to cover these expenses, often with the help of intermediaries hired to evaluate the expenses. The resulting fights often end up in court.

UnitedHealth is owned by investment firm Blackstone Inc., which staffed 2,600 facilities and practices in Oklahoma. won one such lawsuit filed by TeamHealth, a doctors’ group backed by . Following the ruling, TeamHealth asked the court to open records of the hearing.

UnitedHealth said this was confirmed by the court and accused TeamHealth of increasing costs.

“The Oklahoma jury reviewed these documents and our testimony and agreed with us,” a UnitedHealthcare spokesperson said in an email. “TeamHealth continues to push a narrative to deflect attention from the practice of overcharging consumers and the healthcare system with prices that are double or even triple the rates of in-network providers for the same services.”

TeamHealth said UnitedHealth refused to ‘contract at fair rates’ and won most arbitration disputes over payment.

The two companies have been in a years-long battle to influence public opinion on out-of-network billing. While conflicts between insurers and doctors are common, the dispute between UnitedHealth and TeamHealth stands out because of the companies’ size and power and because they have gone public with the fight.

After reaching an impasse in contract negotiations, UnitedHealth planned a public campaign to accuse TeamHealth of “fueling the ongoing rise in out-of-control ER costs across the country,” according to a 2019 internal memo released in the case. TeamHealth representatives distributed portions of the unsealed records, claiming they showed UnitedHealth prioritized profits over members and providers.

The documents show that the doctors’ group isn’t the only party concerned about the way UnitedHealth sets the rates it pays providers outside its network.

A series of emails sent in April 2021 showed internal dissent over how the company handled proposed changes to out-of-network payments for members in consulting firm Deloitte’s plan. It appeared to have started when a member who was married to a therapist questioned why reimbursements were dropping.

The vice president of UnitedHealthcare described how the company is cutting payments for psychotherapy. Prices started at $250 in the first 9 months of 2020, dropped to $188 at the end of the year, and then dropped to $102 in 2021.

Although a later amendment increased the rate to $186, “you can see that what Deloitte wanted to match was still much lower than the ‘original 2020 rate,'” the email said. The subject line read: “Response: Deloitte – Unsatisfied with reimbursement increase,” indicating how the company was grappling with its response.

UnitedHealth’s senior vice president asked for an explanation as to why the payment rate dropped and what the previous reimbursement was based on. “Once we understand all this, we need to decide how to explain this to the customer,” he wrote.

Deloitte representatives did not respond to requests for comment.

Records show UnitedHealth used three different formulas to determine payment rates for out-of-network therapy visits over two years. Two of them are MultiPlan Corp., which helps negotiate reimbursements for out-of-network medical claims and fends off numerous lawsuits from providers alleging anticompetitive conduct. It was from an external vendor called. One of them was from another company called Naviguard, a subsidiary of UnitedHealth.

The UnitedHealthcare vice president then asked how “schedules wouldn’t be changed mid-year without notice like that” given to teams managing the company’s large national employer customers.

Later in the conversation, the senior vice president questioned plans to reduce reimbursement levels for out-of-network emergency room visits. According to the email, UnitedHealth had reduced payments from 450% of what Medicare pays (the reference many insurers use as a starting point for their figures) to 250%, and the company planned to reduce it even further to 150%. At the April hearing, an executive testified that the company had not moved forward with the deepest cuts, according to a transcript.

Such a cut would drop UnitedHealth below national averages: Rand Corp. Counting both in-network and out-of-network rates, employers and private insurers paid an average of 250% of Medicare reimbursement in 2022, researchers reported. Providers often accept discounted payments in exchange for network agreements that provide greater access to patients.

UnitedHealth’s internal emails show tension within the company about how plans to further reduce payments would affect members.

“I’m not saying lowering the reimbursement threshold is wrong,” the senior vice president wrote. “What I have a hard time with is acting like there won’t be any member impact.”

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