MultiPlan Reaches Agreement With California Insurance Commissioner

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MultiPlan, Inc. today announced its settlement of the California state law qui tam lawsuit brought initially over three years ago by Rockville Recovery Associates, Ltd. against the Sutter Hospital System. Both MultiPlan and our affiliate company Private Healthcare Systems, Inc. (“MultiPlan”) were named as Defendants in the suit, which alleged false billing of certain anesthesia services on the part of Sutter, and further alleged that MultiPlan aided and abetted Sutter in these practices through the audit provisions of their provider network contracts with Sutter.

MultiPlan, Inc. today announced its settlement of the California state law qui tam lawsuit brought initially over three years ago by Rockville Recovery Associates, Ltd. against the Sutter Hospital System. Both MultiPlan and their affiliate company Private Healthcare Systems, Inc. (“MultiPlan”) were named as Defendants in the suit, which alleged false billing of certain anesthesia services on the part of Sutter, and further alleged that MultiPlan aided and abetted Sutter in these practices through the audit provisions of their provider network contracts with Sutter.

This agreement to amicably resolve the matter was made strictly on the basis of the additional costs involved in continuing to defend MultiPlan’s position. MultiPlan has consistently and vigorously denied any part in any alleged fraudulent scheme. In fact, MultiPlan contends that it should have been dismissed from the suit at its outset, an argument supported by the financial terms of the settlement.

MultiPlan operates preferred provider organizations that act as intermediaries between payers and providers. As an intermediary, it is critical to MultiPlan's success that provider contracts permit reasonable measures by payers to remedy payment disputes – and for providers to do the same. Rockville alleged that the audit provision in MultiPlan’s contracts with Sutter assisted Sutter in submitting allegedly false, fraudulent or misleading bills to insurance companies with which MultiPlan also had contracts. The audit provision – which was not required to be changed as part of the settlement – adequately provides both Sutter and payers with a remedy for disputed payments.

In addition, MultiPlan does not have any involvement with or responsibility for billing methodology or the setting of service charge masters for any provider participating in their networks, and Sutter confirmed that MultiPlan had no involvement with Sutter’s billing methodology. Furthermore, the number of claims with which MultiPlan was allegedly involved was quite small in relation to the total number of claims which Sutter submitted and which were the subject of the lawsuit.

The Settlement Agreement did not require the amendment of the Sutter agreements or any of MultiPlan’s current hospital network contracts in California. The Agreement did include certain non-financial terms related to network contracts executed with hospitals in California going forward, all of which are already standard MultiPlan contracting practice.

Lawsuit referenced is case number 34-2010-00079432; court of record is the Superior Court, State of California, County of Sacramento.

About MultiPlan
MultiPlan, Inc. is the industry’s most comprehensive provider of healthcare cost management solutions. The company provides a single gateway to a host of primary, complementary and out-of-network strategies for managing the financial risks associated with healthcare claims. Clients include large and mid-sized insurers, third party administrators, self-funded plans, HMOs and other entities that pay claims on behalf of health plans. MultiPlan is owned by BC Partners, a leading international private equity firm, and Silver Lake, the world’s largest private investor in technology. For more information, visit http://www.multiplan.com.

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Susan Mohler
MultiPlan
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Pamela Walker
MultiPlan
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