Ingenix CEO Defends Company’s Databases at Senate Hearing

The top executive at UnitedHealth Group Inc.’s Ingenix Inc. subsidiary conceded Tuesday, March 31, that UnitedHealth’s ownership of the unit created the perception of a conflict of interest, but he denied allegations that the Ingenix databases were flawed and understated charges.

Ingenix collects provider health care charges in developing cost databases that insurers use in determining what are usual-and-customary fees. Several insurers in recent months have agreed to stop using the databases amid an investigation by New York Attorney General Andrew Cuomo into whether the practice resulted in artificially low reimbursement rates for out-of-network services.

“There is an important difference between an inherent conflict and the actual practice of bias—the latter is something neither I nor my employees nor our parent company would ever tolerate,” Ingenix CEO Andy Slavitt said at a Senate Commerce Committee hearing.

Slavitt said that while the company was “myopic” in not recognizing the perceived conflict of interest, it disagrees with any allegations of fraud in the way it collected and provided information.

Committee Chairman John D. Rockefeller IV, D-West Virginia, said Ingenix’s practices resulted in usual-and-customary charges being understated and health care plan enrollees who went outside their health care plans’ managed care network paying more than they should have.

UnitedHealth, as part of an agreement with the New York Attorney General’s Office, has agreed to transfer the Ingenix provider charges databases to an independent, nonprofit entity.

Filed by Jerry Geisel of Business Insurance, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.

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