The latest on providers’ landmark antitrust suit alleging price fixing by MultiPlan and healthcare insurers

Billions of dollars are at issue in an ongoing lawsuit in which providers allege price fixing by a vendor and a large segment of the health insurance industry.

Providers bringing the suit maintain that the healthcare technology solutions company MultiPlan and roughly 700 health plans conspired to suppress reimbursement for out-of-network services over a decade (MultiPlan rebranded this year as Claritev).

Applicable out-of-network claims include those that were processed by MultiPlan or its subsidiary algorithm platforms Data iSight and Viant dating back to 2015. That was when large insurers such as Cigna and Aetna began shifting to MultiPlan’s claims repricing service, the plaintiffs state. UnitedHealth Group and others followed in 2016.

“People may be sitting on tens, twenties, hundreds of millions of dollars or more in damages related to this and may not have any idea,” said Matt Lavin, a partner with Arnall Golden Gregory and a member of the plaintiffs’ executive committee for the multidistrict litigation.

In addition to highlighting ongoing strain in payer-provider relations, the case illustrates providers’ concerns about payers’ use of algorithms to make coverage and payment determinations.

High stakes

The litigation is one of two momentous antitrust lawsuits involving provider complaints about insurer practices. A case against Blue Cross Blue Shield and its member health plans resulted in a $2.8 billion settlement that is subject to final court approval during a hearing scheduled for July 29. That’s also the postmark deadline for providers to file a monetary claim if they have not opted out of the settlement.

Unlike the BCBS case, the primary MultiPlan litigation is not a class action at this stage. Instead, the consolidated case consists of individual suits brought by hundreds of providers, Lavin said. However, there also is a separate case bringing similar claims as a class action.

Lavin argues that filing an individual legal claim “is a better way to get these [disputes] resolved because you can negotiate a settlement based on your actual [healthcare] claims experience.”

The stakes in the MultiPlan litigation may be significantly greater than even the BCBS case, although exact damages are hard to pinpoint. In a consolidated complaint filed in November 2024, plaintiffs cited documentation from MultiPlan indicating the company processed $106 billion in out-of-network charges in 2019, representing 81.5% of the market.

Underpayments to providers allegedly totaled $19 billion in 2020 and “metastasized” to $6.4 billion for Q3 2024. In accordance with antitrust law, the case also brings the potential for triple damages.

In addition to MultiPlan, defendants in the consolidated direct-action lawsuit include virtually all the major insurers in the U.S., along with third-party administrators. Plaintiffs in the separate class-action case are not suing TPAs.

Allegations of misconduct

The plaintiffs say MultiPlan’s business model starts with gathering confidential pricing data from insurers with which it contracts. From there, the company uses a proprietary algorithm to set substandard reimbursement rates for healthcare services. Specifically, those rates are generated via the company’s Data iSight platform.

The rates are then widely adopted by leading insurers. MultiPlan promotes its ability to “align” payment rates for out-of-network services, which amounts to stifled price competition, the plaintiffs allege.

In negotiations with MultiPlan, according to the lawsuit, providers have little recourse but to accept the negotiated amount as full payment and agree not to pursue the additional balance owed by patients. The company collects a lucrative fee based on the underpayment, Lavin said.

In March, the U.S. Department of Justice filed a court statement to the effect that if the allegations are proven true, they would constitute a violation of antitrust law.

“Using a common pricing algorithm can indeed qualify as a concerted action under [antitrust law], even if the competitors do not always use the algorithm the same way,” according to the statement.

In addition, “competitors’ exchange of competitively sensitive information can violate Section 1 [of the Sherman Antitrust Act] even if those exchanges occur through an intermediary,” DOJ stated.

“We remain confident in the strength of our legal position and look forward to presenting the facts as the case moves forward,” Claritev (formerly MultiPlan) said in a written statement. “These lawsuits will only serve to increase healthcare costs for employers and patients. We will vigorously defend ourselves through the legal process while remaining focused on delivering value to our customers and the broader healthcare ecosystem.”

An early win for plaintiffs

Defendants filed to dismiss the case in early April. In June, however, the presiding judge rejected the motion.

The defendants had argued, in part, that providers are not harmed by the pricing mechanism because they can choose to collect the balance of the payment from patients by essentially opting out of receiving the negotiated payment amount from MultiPlan. Providers countered that there is a valid reason for them to agree to a balance-billing prohibition as a condition of accepting the payment, given the challenges of trying to collect from patients.

Judge Matthew Kennelly (a Clinton appointee) of the Northern District of Illinois federal court agreed with providers and, in a possible nod to their chances of winning at trial, said descriptions of how insurers refrained from competing with each other on out-of-network pricing were indicative of antitrust injury.

“Price-fixing agreements between competitors cannot be justified at all, let alone by the argument that currently fixed prices are more ‘reasonable,’” Kennelly wrote. Citing prior case law, he also said, “The simple agreement to fix prices satisfies the ‘conspiracy’ element of the antitrust violation, whether or not the conspiring parties actually had the power to fix prices.”

Some of the plaintiffs’ arguments involve allegations of parallel conduct, meaning multiple companies within an industry adopt similar business practices such as pricing strategies, regardless of whether there is an explicit agreement. MultiPlan and fellow defendants maintain that the algorithm is customizable, thus negating claims of price fixing.

Kennelly did not buy that contention, writing, “An agreement to fix prices within a below-market range through use of an algorithm is no different for antitrust purposes than an agreement to fix prices to a single point.”

Next steps

As is often the case with big lawsuits, the litigation is proceeding in fits and starts. After Kennelly allowed the case to proceed, a trial date was set for December 2027, nearly 30 months away. It is not far-fetched to think there could be some type of resolution before then, however.

“A lot of these cases settle eventually, but the trick is that you’ve got to get yourself in there,” Lavin said.

He expects there to eventually be a cutoff date for bringing claims, so providers may want to act soon.

“If anybody’s having trouble determining whether they have claims that are eligible for this suit, I urge them to reach out [to an attorney] and ask about it,” Lavin said.