Isn't It The Truth?

Isn’t it amazing how whenever an industry makes a money mistake it is inevitably in favor of the “mistakor” (the industry) rather than the “mistakee” (the consumer)?

Another example of this truism just came to light with a settlement recently announced between the State of New York and giant insurer, UnitedHealth Group.

The State investigated claims that databases operated by a UnitedHealth business unit and widely used by insurance companies to calculate policyholder reimbursements when policyholders used doctors who were not part of the insurance company’s network, consistently underreported the actual cost to patients, thereby saving insurance companies hundreds of millions of dollars over the last decade.

Insurers usually have to reimburse policyholders 70 or 80% of an out-of-network doctor’s charges. If the charge is said to be $80 rather than the actual $100 charge, the insurance company’s 70% reimbursement cost would be $56 rather than the $70 it should be. And, the policyholder is stuck with paying the difference.

In the settlement, UnitedHealth agreed to pay $50 million to create new databases to determine the prevailing cost of medical care in various sections of the country. The database will be created and operated by a university yet to be named.