Providers file class action lawsuit against UnitedHealthcare Inc., OptumHealth Care Solutions and more
“Our strategy is to send a message to other insurance companies that they have an obligation to pay under those statutes," said Steven Adler, a partner at Mandelbaum Barrett.
Attorneys have filed a class action lawsuit in a federal district court in Orlando for health care providers and individual plaintiffs, arguing that their clients are fed up with the “illegal hurdles” by several insurance companies to avoid paying up on COVID-19 services.
Steven Teppler and Steven Adler, of counsel and partner at Mandelbaum Barrett in Boca Raton, Florida, and Roseland, New Jersey, respectively, represent plaintiffs Aventus Health LLC and multiple laboratories, along with proposed class representative Sean Bygrave. They filed suit against several defendants, including UnitedHealthcare Inc. and OptumHealth Care Solutions.
“They’ve done every trick in the book to make it almost next to impossible for providers to get reimbursed,” Adler claimed. “It is one delay tactic after another, while at the same time they earned billions of dollars in profit during the pandemic. Our strategy is to send a message to other insurance companies that they have an obligation to pay under those statutes.”
Adler is referring to the Families First Coronavirus Response Act, also known as FFCRA; the Coronavirus Aid, Relief, and Economic Security Act, also known as the CARES Act; the Employee Retirement Income Security Act, also known as ERISA; and the Class Action Fairness Act, also known as CAFA.
By press time, neither United Healthcare nor OptumHealth had counsel listed on the docket. Their media departments did not respond to a call or email requesting comment on the 43-page complaint.
Complex Process for Denials?
Aventus and the laboratories obtained an assignment of benefits from defendants to receive direct payments they are owed, according to the complaint. And at issue are the insurance companies’ failure to pay more than 34,000 claims for coronavirus diagnostic testing that plaintiffs provided and continue to provide to defendants’ members and beneficiaries.
Congress and the Trump and Biden administrations have made clear in the FFCRA and the CARES Act that group and individual health plans and health insurance issuers, such as defendants, must cover and reimburse the coronavirus testing and related services, plaintiffs argued.
Since March 2020, Aventus and the laboratories have posted the cash price of its COVID-19 treatments on their public websites. However, they claimed that the defendants failed to negotiate a different rate, making them obligated to reimburse plaintiffs under the CARES Act.
Plaintiffs’ counsel acknowledged that defendants paid most of the claims for testing that Aventus and the laboratories submitted up to June 2020. But from June 2020 onward, “defendants have been systematically denying payments for those claims,” and have made it impossible to appeal denials, calling their internal appeals procedures a “joke.”
“These actions have included setting up complex processes and procedures to deny or underpay claims for arbitrary reasons, engaging in a paperwork war of attrition in an effort to wear down Aventus and the laboratories, turning United’s internal administrative appeals procedures into a joke and thereby rendering the administrative appeals process functionally meritless, and ultimately engaging in unscrupulous and fraudulent conduct for its own financial benefit during the COVID-19 pandemic,” the plaintiffs alleged.
Now, the case will go before U.S. District Judge Roy B. Dalton Jr., who sits on the Middle District of Florida bench.
Read the lawsuit:
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Plaintiffs are suing the defendants on eight counts, including violation of the FFCRA and the CARES Act, failure to pay the ERISA claims despite the proper assignment of benefit forms, and unjust enrichment and quantum meruit, according to the lawsuit.
The potential class — beyond the 34,000 claims — is estimated by the plaintiffs to be tens of thousands of people.
They defined the class as insureds, participants or beneficiaries in any group or individual health insurance plan issued, underwritten or administered by one or more of the defendants who were denied health insurance coverage for COVID-19, or paid or were required to pay for testing, between March 2020 to the present.
Related: Lawsuit accuses UnitedHealthcare Group of underpaying benefits for out-of-network care
And plaintiffs’ counsel argued that the defendants can foot the bill, citing, in part, their “reported profits of $15.4 billion in 2020.” They added that when “businesses across the country continue to grapple with economic loss in the face of a global pandemic, United reported an almost 12% increase in profits to $17.3 billion in 2021.”