LAS VEGAS (Legal Newsline) - Day one of a three-week trial saw attorneys for Fremont Emergency Services of Las Vegas accuse United Healthcare Insurance of deliberately under-paying medical emergency room claims, to save money and maximize profits.
The accusations against United Healthcare includes breach of contract, unjust enrichment and unfair insurance claims.
United Healthcare is the country’s biggest health care insurance company with offices in 50 states and a headquarters in Minnesota. The insurance company pays out reimbursements for medical treatments in Nevada emergency centers, which operate separately from hospitals.
The case is important because the outcome could impact the amount of reimbursement rates emergency room doctors receive. A federal law, the Emergency Medical Treatment and Labor Act, currently mandates that doctors and staffers must treat emergency room patients regardless of their insurance or ability to pay.
The plaintiffs include Fremont Emergency Services serving the Las Vegas area, Ruby Crest Emergency Medicine providing emergency services in Northeastern Nevada (Elko), and Team Physicians in Fallon.
The defendants in addition to United Healthcare include affiliates Sierra Health Services, Health Plan of Nevada, Oxford Health Plans and United Medical Resources both of Delaware.
Pat Lundvall, attorney for Fremont Emergency Services with the Las Vegas law firm of McDonald Carano, in opening remarks told a jury the case is about the quality of health care in Nevada.
“South Carolina is at the top of medical care with an average $1,034 payment per (emergency room) visit,” Lundvall said. “Nevada is at the bottom with $344 per visit.”
Lundvall called United’s short-paying of emergency room reimbursements in Nevada a case of intentional “discrimination.”
“We’re asking you to say enough is enough,” Lundvall urged the jury.
Lundvall said 11,500 claims have been under-paid by United Healthcare. She cited one case, a gunshot wound treated in an emergency room (EMR) where $1,428 was billed and $254 was received.
“EMR providers are not employees of hospitals,” Lundvall explained. “Every person who has an emergency is to be provided care, regardless of whether they can pay. This is morally right. EMR’s cannot turn people away.”
Lundvall said an affiliate of Fremont Emergency Services named “Team Pals” handles the business side of the operation and does the billings. She added that officials of United Healthcare know the fewer and lower claims you pay out, the more profits you make.
“United has not contested that we did the work (emergency treatments),” Lundvall said. “We deserve to be paid. Their internal documents admit they have an obligation to pay. But it’s whatever they feel like paying. They figure out how to pay less. The payments went lower and lower. They said if you don’t like it, sue us. We did.”
Lundvall indicated there only two options, file a lawsuit, or pass the difference between what is paid and the remainder owed onto the patient---the latter being unacceptable
She said according to Fair Health, a nonprofit that gathers information about charges and payments, the amounts billed by Fremont were reasonable compared to overall health industry rates. She noted that when United stopped using the nonprofit as a benchmark, the payments started to fall.
Lundvall predicted attorneys for United Healthcare in their arguments would allege fraud; that Fremont was trying to get more than it was entitled to. She called that an attempt to “distract” from the truth.
“There is no fraud,” Lundvall said. “They (United) are cocky. They are taking advantage of federal and state laws that obligate us to treat (emergency patients).”
Defense attorneys later in the day objected to Lundvall’s statement, that the quality of healthcare in Nevada was at stake in the case or that the trial outcome would impact rates.
Lee Blaylock, the defense attorney for United Healthcare with the Las Vegas firm of Snell & Wilmer, said central to the case is the question, what is a reasonable reimbursement rate? He said the plaintiffs wanted $10.4 million more than was paid out.
“There was no previously understood amount owed for these services,” he said. “There was no payment methodology, no written or oral contract.”
He called the charges demanded by Fremont as “grossly inflated,” and added that medical service providers hardly ever get paid the full amount of what is billed.
“Over 90% are not paid in full by people (insurance providers),” Blaylock said.
Blaylock accused TeamHealth Holdings Inc. of Nevada, which acquired Fremont Emergency Services, Advanced Care Emergency Services and Advanced Care Emergency Specialists, of acting in bad faith to extract more money out of United Healthcare, inflating payments and then filing a lawsuit to enforce it.
Blaylock also took issue with comments from Lundvall that Fair Health had deemed the billings as reasonable.
“Fair Health (officials) will testify it does not set industry standards (payments),” he said. “We will prove the rates were arbitrarily set by the provider (Fremont).”
Blaylock said his client did not seek to denigrate the important job of emergency room responders or the valuable services they provide.
“The proof will show that emergency staff should not be permitted to gouge my clients with inflated charges,” he said. “My clients can’t afford it.”
Blaylock said of 11,500 disputed claims, 90% of them come from Fremont.
“This case is about Fremont,” he said.
Blaylock said the plaintiff was asking for what amounted to a rising stairway of reimbursements into perpetuity. He indicated it is rare for any insurance provider including major national companies such as Aetna and Blue Cross to pay a full amount billed.
Aetna, for example, he said 93.6% of the time paid less than the full amount of services billed.
“They (Fremont) are saying the defendants have an obligation to pay---forever,” Blaylock said. “This is an expectation as if it was a right. My clients paid full 7% of the time. They (Fremont) are saying you did it before. But my clients hardly ever did. There is no evidence, no set standard that you should pay in full.”
Blaylock said the charges sent to his clients were being arbitrarily inflated in a system in which rates had gone up between the years 2017 and 2020.
“Would you pay a cab driver if you didn’t know the rate and then he said he would charge you $100 after he drove you around the block,” Blaylock surmised. “Then he said, ‘pay me.’ Would that be fair? These charges (Fremont) are not the reasonable value.”
The first witness called on Tuesday was John Habin, a former United Healthcare vice president. Habin was asked by John Zavitsanos a Houston attorney for the plaintiff with AZA Law if the more United Healthcare cut rates of payment; the less doctors got paid, and the more the company made in profits.
Habin indicated his company had tried to serve clients and save them money when requested.