Health billing company draws ire from insurers over 'cartel-like' practices

In business, outsourcing has been a long-standing practice that can work well if, say, you need help running peripheral tasks while you are operating the core revenue-generating parts of your business. For one Tennessee company, this has not worked out so well.

According to a report in the Tennessee Lookout, Knoxville-based TeamHealth, which created a system of outsourcing hospital emergency medical care, is accused of using emergency rooms to generate profit in a “cartel-like” behavior, which includes price fixing, legal intimidation and fraud.

Related: PillPack will pay $5.79M in fraud lawsuit settlement

“TeamHealth designed the complex structure of the TeamHealth System to circumvent state laws that prohibit general business corporations from practicing medicine,” says the news article, quoting the latest proposed class-action lawsuit filed against the firm states.

“It is now evident from multiple other lawsuits that [TeamHealth} … systematically overbilled (patients and insurers) for years,” the lawsuit continues. “[Overbilling by] upcoding is part of TeamHealth’s regular way of doing business, and absent judicial intervention, TeamHealth will continue its upcoding scheme for as long as it remains profitable.”

According to the media report, in just two years, TeamHealth has paid nearly $100 million to settle thousands of complaints from emergency room patients billed thousands of dollars for treatment of minor ailments.

In a response to the allegations, TeamHealth defended its billing practices and pointed the finger at health insurers such as UnitedHealth, which it says has ”generate[d] record profits by down coding claims and refusing to consider the expertise of frontline clinicians who make a diagnosis.”

TeamHealth cited multiple recent court cases in which major insurers have come under fire for their reimbursement practices, noting that counterclaims filed against TeamHealth in each case were dismissed. According to a statement, “TeamHealth engages professional coders to code our emergency department claims, and they have no incentive to do anything other than bill correctly.  We have arduous internal and external auditing of our coding processes. We use the same grid for coding that we have used for over ten years without change.”

Read more: 

• DOJ goes after Kaiser Permanente over upcoding claims
• HCA Healthcare accused of Medicare fraud, excessive hospital admission rates
• Health care fraud dominated DOJ’s false-claims recovery cases last year