UnitedHealth Cries Fraud in $100M Lawsuit Against TeamHealth

 Insurance company UnitedHealth filed a lawsuit against TeamHealth, one of the country's largest emergency services staffing companies, alleging that the company's systematic upcoding has led to more than $100 million worth of overcharging.

Filing the lawsuit in Tennessee's federal district court, UnitedHealth charged that TeamHealth has "covertly and methodically engaged in a form of healthcare fraud called upcoding," wherein healthcare providers submit a claim to an insurer using a Current Procedural Terminology (CPT) code that misrepresents -- and, more importantly, overvalues -- the services provided in the emergency room (ER).

"The United Plaintiffs have reviewed tens of thousands of commercial health benefits claims submitted by TeamHealth and have determined that well over half of the claims TeamHealth submitted to United using the two highest-level CPT codes for ER visits -- roughly 60% -- should have utilized lower-level CPT codes," the complaint reads.

In one example of TeamHealth's alleged upcoding, a 23-year-old man suffering from indigestion after eating a chili dog went to a TeamHealth-staffed ER; he was sent home with the antacid Maalox. UnitedHealth says that the claim submitted to them by TeamHealth indicated that this patient received "emergency medical care of particularly high complexity under exigent circumstances," resulting in a $1,712 charge.

UnitedHealth's complaint emphasizes that the profits earned by upcoding are never seen by physicians and other healthcare professionals employed by TeamHealth.

"TeamHealth handles everything related to the coding and billing of claims from its centralized billing centers. It is TeamHealth's coders who decide which codes to utilize, applying TeamHealth's policies. It is TeamHealth that submits claims to insurance companies under the names of its affiliated or acquired medical groups," the suit states. "And it is TeamHealth -- not the medical groups or the doctors or other providers -- that keeps the profits from its fraudulent billing."

The complaint seems to be the next phase of litigation in the legal battle that the two companies have been embroiled in for the past few years. In 2019, TeamHealth filed its own complaint against UnitedHealth, accusing the insurance company and its subsidiaries of underpaying claims and working with Data iSight, a third-party administrator, to systematically reduce payment rates.

In 2020, when New-York-based emergency physician groups sued UnitedHealth for underpaying them for out-of-network services, UnitedHealth responded by saying that, "a small number of providers, and especially private equity-backed physician staffing companies like TeamHealth, are driving up the cost of care for the people and customers we serve," the insurer told media outlets.

"Some of the TeamHealth provider groups that are not part of our network today charge 700-900% of Medicare rates for the care they provide ... This sort of excessive pricing from out-of-network providers contributes to skyrocketing health care costs for everyone. TeamHealth has filed a lawsuit in an attempt to challenge our efforts to address the unreasonable and anticompetitive rates its providers charge," the statement continued.

UnitedHealth's current lawsuit against the staffing firm posits that, since its 2017 acquisition by private equity giant Blackstone, TeamHealth's coding tactics have "crossed the line from aggressive profit maximization to fraud."

In its defense, TeamHealth CEO Leif Murphy claims that UnitedHealth's lawsuit is just a way for the insurer to divert attention away from an upcoming Las Vegas court case brought by TeamHealth affiliate Fremont Emergency Medicine against UnitedHealthcare "for their gross underpayment of frontline clinicians."

"United continues to generate record profits by down coding claims and refusing to consider the expertise of frontline clinicians who make a diagnosis," Murphy told MedPage Today in an email.

"Even during a pandemic, United utilizes tactics like these to profit off the backs of emergency medicine providers who are on the front line treating patients and risking their own lives. The bottom line is the less UnitedHealth reimburses, the more profits they make," said Murphy.

Notably, UnitedHealth also had a contentious working relationship with Envision, another large staffing company backed by private equity firm KKR. After years of back and forth -- during which UnitedHealth accused Envision of having rates that were double, even triple, the median -- the insurer eventually cut the firm out of their network entirely in 2021.

https://www.medpagetoday.com/special-reports/exclusives/95349