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UnitedHealth Will Pay $400M To Settle Allegations Of Bad Faith Insurance Practices

UPDATED: December 12, 2019

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UnitedHealth Group, the nation’s largest healthcare insurer, has agreed to pay $400 million to settle allegations brought by New York Attorney General Andrew Cuomo and the American Medical Association that the insurer limited payments to doctors – thereby forcing patients to pay more.

Bad faith insurance practices

The controversy over UnitedHealth Group’s subsidiary, Ingenix Inc., has been going on for years. Ingenix is a health care information and research company. While the company is a subsidiary of UnitedHealth Group, other insurance giants such as Blue Cross, Blue Shield, CIGNA, Wellpoint and Aetna (the latter of which recently settled a similar lawsuit with Cuomo for $20 million) also used the company’s database to determine payments to doctors both within a health maintenance organization’s (HMO’s) network and outside it.

The company itself, and the insurance industry as a whole, has been accused of bad faith insurance practices by unfairly rigging payments to doctors – and when doctors aren’t paid what they billed for their services, that obligation falls on patients’ shoulders and saves the insurance industry money. A lot of money.

Settlement terms

It is estimated that consumers paid hundreds of millions of dollars to doctors over the past 10 – 15 years that should have been paid by insurance companies. According to news reports, United will spend $400 million to settle class action lawsuit allegations brought by Cuomo and the American Medical Association that it rigged payments to doctors over the past 15 years through the Ingenix database. While $350 million of that amount will go into a class action restitution fund to pay doctors and patients for services provided out of network, the company has also agreed to spend $50 million to create a new database that will allow a non-profit group to set new amounts payable to doctors in the future. The current Ingenix database will no longer be used. According to a press release on the Attorney General’s website,, Cuomo said:

For the past ten years, American patients have suffered from unfair reimbursements for critical medical services due to a conflict-ridden system that has been owned, operated, and manipulated by the health insurance industry. This agreement marks the end of that flawed system.

If your insurance company has acted in bad faith, contact an experienced bad faith insurance attorney to discuss your situation and evaluate your options. Consultations with a lawyer are free of charge, without obligation and are strictly confidential.

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