AdventHealth has filed an antitrust lawsuit, claiming MultiPlan’s strategy of collaborating with insurers and aggressively repricing out-of-network services violates Sherman Act Section 1. AdventHealth alleges MultiPlan orchestrates a “MultiPlan Cartel” involving major healthcare insurers. The lawsuit seeks damages for underpayments and lost revenue, supported by evidence of anticompetitive contracts. MultiPlan denies merit in the lawsuit. AdventHealth’s claims center on MultiPlan’s dominance, likened to a “mafia enforcer for insurers,” forcing providers to accept reduced reimbursements. The lawsuit presents alternative theories of liability and seeks both compensation and a permanent injunction against MultiPlan’s business model.
AdventHealth has filed a legal complaint asserting that MultiPlan’s operational strategy, which involves collaborating with other payers and aggressively adjusting payment rates for out-of-network services, violates antitrust regulations outlined in Section 1 of the Sherman Act.
According to the complaint submitted to the U.S. District Court for the Southern District of New York, AdventHealth claims that MultiPlan orchestrates what it terms the “MultiPlan Cartel,” a long-standing conspiracy that includes the majority of significant healthcare insurance payors in the U.S., such as Aetna, Elevance Health, Centene Corporation, Cigna Group, Health Care Service Corporation, UnitedHealth Group, and Humana.
AdventHealth alleges that MultiPlan should be held liable for damages due to its contract agreements with these horizontal competitors, acknowledging the existence of these arrangements. The legal action seeks compensation for alleged underpayments and lost revenues, estimated to amount to hundreds of millions of dollars. The complainant asserts that it possesses substantial evidence of MultiPlan’s anticompetitive contracts, including regulatory filings.
The complaint further argues that MultiPlan’s dominant position allows it to act as a powerful force in negotiating with insurers, often being likened to a “mafia enforcer for insurers.” This influence is attributed to the fact that a vast majority of healthcare payors have adopted MultiPlan’s repricing methodology, leaving healthcare providers with minimal choice but to accept the revised reimbursement amounts imposed by MultiPlan.
In response, a MultiPlan representative has stated that the company views the lawsuit as lacking merit and anticipates refuting the baseless allegations.
AdventHealth, a nonprofit organization operating across nine states with 50 hospitals, claims that MultiPlan disrupted traditional negotiations between health systems and individual payers in 2006 when it acquired several companies to develop a reimbursement claim analytics tool. This tool, according to AdventHealth’s complaint, is then utilized to generate offers that significantly underpay providers for their services, leveraging confidential claims data from other payers.
Although large providers often have their billing collections operations, MultiPlan allegedly pressures them into accepting its “take-it-or-leave-it” offers for out-of-network inpatient services, with an acceptance rate of 99.4%.
AdventHealth contends that by 2020, MultiPlan was using its repricing tools to underpay around 370,000 out-of-network claims daily, resulting in an estimated annual underpayment of $19 billion to healthcare providers. MultiPlan’s website boasts annual savings of over $22 billion.
AdventHealth’s lawsuit proposes three alternative theories of liability, all of which revolve around potential violations of the Sherman Act due to MultiPlan’s business model. The first theory emphasizes MultiPlan’s role as a competitor, alleging horizontal restraint of trade. The second theory suggests a “hub-and-spoke” conspiracy, with MultiPlan at the center and its contracts forming the spokes, all united by agreements to use the repricing methodology. The final theory contends that MultiPlan’s agreements have anticompetitive consequences across the market for out-of-network healthcare reimbursements, without any procompetitive benefits.
In addition to seeking compensation for economic damages, AdventHealth asks the court to permanently restrict MultiPlan from continuing its contracting model with other payers.