There's few things quite as frustrating as trying to haggle with an insurer over reimbursement for the costs of medical care. New York scored one for the little guys yesterday when it secured a settlement with UnitedHealth Group, one of the nation's largest insurers, forcing the company to close its Ingenix billing database that health insurers have been using for years to determine payment rates for patients who have used an out-of-network doctor.
As reported by the New York Times, a statement by the New York's Attorney General, Andrew Cuomo, claimed that the industry had engaged in "a scheme to defraud consumers" by systematically underpaying the nation's patients by hundreds of millions of dollars over the last decade. One example given was:
"The patient might receive a doctor's bill for $100, for example, and expect the insurer to pay at least $70. But if the insurance database says that doctor bill should have been only $72, based on local rates, the patient might get back less than $55."
Allegedly, the data used by the Ingenix system was ripping consumers off by understating the "reasonable and customary" rates of medical care by up to 28 percent. The settlement reached with the state requires the creation of a new, independent database to be run by a university. However, the settlement leaves unaddressed the bigger questions of whether there was actually underpayment to doctors and whether consumers were short-changed, and litigation on those issues continues.
So what is there to be done if, despite these impending changes, you feel your insurer is "lowballing" you for the costs of your medical care? It's going to depend on the circumstances of each case, but generally, insurers have an obligation to deal with their insureds "fairly" and in "good faith". Now this doesn't mean the insurer has to go ahead and pay up on any and all claims made, but it does mean the insurer has to at least:
(1) Process an insured's claim in a timely and reasonable manner; and
(2) Address the claim fairly, in line with the terms of the applicable policy.
Unfortunately, as anyone who has sat down and tried to read the arcane and sometimes lengthy language of their policy can attest to, it's not hard for insurers to take a wide variety of positions on what is "fair" and "reasonable" without crossing the line into bad faith. However, the creation of a new, independent database is a step in the right direction toward making the process a little more transparent for the public, and some of the numbers won't lie in the hands of an "interested" party.