Klobuchar asks regulators to investigate MultiPlan over health care pricing

A data analytics company helped large health insurance companies cut doctors' payments, sparking concerns about a possible drug deal prices.

Recent revelations about a data analytics company's role in determining medical payments have heightened concerns about a possible drug deal. health care prices and led to a call for a federal investigation.

In a letter this week, Sen. Amy Klobuchar asked federal regulators to examine whether algorithms used by the company MultiPlan helped major health insurers conspire to cut doctors' payments and leave patients with large bills. She cited a New York Times investigation last month into MultiPlan's dominance of the lucrative out-of-network medical claims pricing business.

“Algorithms should be used to make more effective decisions. accurate, appropriate, and effective, so as not to allow competitors to collude to make health care more expensive for patients,” Ms. Klobuchar wrote to the heads of the Justice Department’s antitrust division and the Federal Trade Commission .

When patients see a medical provider outside their plan's network, insurers often send their claims to MultiPlan, which uses proprietary algorithms to recommend the amount to pay. By reducing payments to providers, MultiPlan and insurers can collect higher fees for themselves, the Times reported, but that can result in higher bills for patients, who may be charged the unpaid balance.

UnitedHealthcare, Cigna, Aetna and other major insurers use MultiPlan's pricing recommendations, and the company has boasted to investors that it is "deeply integrated" into its customers' complaint processing systems.

In interviews, Ms. Klobuchar, a Minnesota Democrat, and antitrust law experts said the arrangement could amount to to price fixing: rather than competing to offer better coverage, insurers could use the low prices recommended by MultiPlan. algorithms, knowing that their competitors would likely do the same.

“This should trigger an investigation by the agencies,” said Barak Orbach, a law professor at the University of Arizona. “There appears to be a very strong case.”

The F.T.C. and the Justice Department declined to comment, but both agencies have raised concerns in the past about similar arrangements in other sectors.

Image“Algorithms should be used to make more accurate, appropriate, and efficient decisions, not to allow competitors to collude to make health care more costly for patients,” Sen. Amy Klobuchar wrote in a letter to antitrust regulators.Credit. ..Valerie Plesch for The New York Times

In a statement, MultiPlan did not respond to the price-fixing allegations, instead emphasizing its commitment "to helping make transparent, fair and affordable healthcare for all. In its legal filings, the firm denied allegations of collusion and said insurers were free to reject its pricing recommendations or negotiate higher payments with providers.

Insurers said MultiPlan's tools help combat outrageous billing by some providers, including consolidated hospital systems and privately funded staffing companies.

Documents reviewed by The Times indicate that MultiPlan sometimes told insurers how their unnamed competitors used the company's pricing tools. In a 2017 presentation at UnitedHealthcare, MultiPlan shared its “Recent Client Strategies to Improve Outcomes,” which included techniques that could reduce payments to providers.

After a meeting in 2019, a representative from UnitedH...