This falls under the series as it was a group of formulas and algorithms that allowed the short payments to continue on.  When the claims were submitted, doctors had the choice of either substantiating their actual shortages or could accept their portion of the settlement by letting United (Ingenix which is now Optum) calculate it for them.  We all might remember when Cuomo from New York questioned and found the data base was out of whack with normal and customary fees charged and most of the other insurers licensed and subscribed to the same data base so United collected from their use of the data base as well it appears. 

I did one story here a while back to where HealthNet agreed to pay claims at 14% higher than the data base called for until the actual settlement was reached and the data base was disbanded.  This goes back to June of 2009. 

Health Net Agrees to Stop Using Ingenix Database for Calculating Reasonable and Customary Fees

That was an interesting time as with the Tri-Care bidding going on United ended up buying a big chunk of HeatlhNet in the New England area.

United HealthCare Purchase of HealthNet in the Northeast Did Not Include Transfer of Employees

The Tri-Care battle over contracts is still going on with a lawsuit filed by United as that was and probably still is an administrative mess.  This goes back to June of 2011 and I have not seen the outcome of this one yet.

Update: UnitedHealthcare Sues Department of Defense Over Tri-Care Contracts–They Said They Would Do This – Is This A Case Of My Algorithms Are Better Than Yours?

Long and short of this outside of the checks being sent out is a reminder of the fact that United has been in the analytics business a long time and the settling of this lawsuit reminds us all to at times ask questions and see how the analytics are being used and make sure you are not under the Attack of the Killer Algorithms unknowingly.   Last week I commented about the new “cloud” services that is due out soon to market hospitals and doctors and over at Seeking Alpha a writer was very kind to link back to this post and he mentioned how United was winning the war with Health IT, and again from someone outside the industry a very good look at what has been done, but in reality their analytics and algorithms produced have been around for a long time, just behind the scenes where most either don’t look or see. 

UnitedHealthCare Launching Cloud Platform Via Optum Subsidiary Will Sell Apps Like the Apple Store But They Won’t Be As Much Fun And Solicit Hospitals for Record Storage

About a year ago was the last time I covered the Fair Data base which is now run by a non profit who hopefully has some analytics of their own to make sure insurance companies keep their algorithms in check. 

New FAIR Data Base Slated to Be Available Later this Year To Replace imagethe Corrupted Data Base Used by Ingenix to Calculate Out of Network Insurance Charges

“FAIR Health is a national independent, not-for-profit corporation whose mission is to bring transparency to healthcare costs and health insurance information through comprehensive data products and consumer resources. FAIR Health uses its database of billions of billed medical and dental services to power a free website that enables consumers to estimate and plan their medical and dental expenditures. The website also offers clear, unbiased educational articles and videos about the healthcare insurance reimbursement system. In addition to its consumer offerings, FAIR Health licenses data products to businesses, governmental agencies, healthcare providers and researchers. With its professional staff of experts in healthcare, statistics, technology and communications, FAIR Health strives to offer accurate, consistent and timely information to all stakeholders in the healthcare system.”

There are still a few more lawsuits that are smaller out there floating around related to this data base and who knows when they will all be solved.  This one also just sprung up last yea.

Outpatient Surgery Centers File Class Action Lawsuit Against UnitedHealth and Ingenix for Underpayments

In this case just due to the settlements here with with math and formulas, this makes a good case to stop and think about the algorithms in use and perhaps as yourself if you think they are designed for “accuracy” or “desired” results. 

The 2 should be the same but as the outcome of this lawsuit shows they are not always and that goes for any area of healthcare but especially the payables end of the equation as that’s where all the ruckus and lawsuits always take place. 

I have a summary post of how the Killer Algorithm Attacks occur in other businesses and other areas of healthcare too that has a great video that explains how “context is everything” so ask question today by all means as the amount of flawed data out there used for analytics is certainly on the rise with data mined from the internet combined with steroid marketing for a sometimes “big spin” and it’s hard to tell the difference .  BD 

Attack of the Killer Algorithms–Digest & Links for All Chapters–See How the Math and Crafty Formulas Today Running on Servers 24/7 Make Life Impacting Decisions About You

Twelve years after the original AMA v. UnitedHealth Group litigation was filed, and three years after the class-action settlement was announced, physicians and patients can expect to see checks in the mail soon, representing their part of the $350 million settlement.

U.S. District Court Judge Lawrence McKenna signed an order Feb. 2 allowing for the settlement disbursement. The money is meant to compensate millions of doctors and patients for payments lost as part of a system under which United and other insurers underestimated the "usual, customary and reasonable" charges for certain services.

Some insurers base what they pay out-of-network physicians on UCR. Physicians had argued for years that the UCR payments bore little relation to typical charges, and that the methodology behind them was hidden in what they called a "black box."

"While the monetary settlement is important, far more important is the fact that under the settlement agreement, United and other health insurers will no longer be able to use the flawed Ingenix database to determine out-of-network payment rates," Rick Abrams, executive vice president of the Medical Society of State of New York, said in a statement.

Now that the litigation has been wrapped up, the $350 million -- plus interest, and minus attorneys' fees and the cost of sending the settlement notices and checks -- is on its way to doctors and patients. Checks were expected to be in the mail beginning in February.

The new medical charge database, known as FAIR Health, is up and running, and offers not only a new database for insurers and physicians, but also a new online tool for consumers to see typical charges for medical services in their area.


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