- The U.S. District Court of Southern Florida has granted UnitedHealthcare's motion to compel arbitration in a lawsuit Envision filed in March that alleges breach of contract. The insurance giant requested arbitration in April, claiming Envision's lawsuit violates the enforceable arbitration clause in their contract.
- UnitedHealthcare decided to terminate its contract with Envision by Jan. 1, 2019, and has since been publicly critical of the provider's "outrageous" billing practices.
- The court also granted UnitedHealthcare's motion for a stay of action, dismissing the suit without prejudice and ultimately leaving Envision at a disadvantage when the two companies negotiate a new agreement.
The court's decision to force arbitration is a big win for UnitedHealthcare. Envision originally claimed the insurer had breached their contract by lowering payment rates and refusing to add Envision physicians to their network, and the provider has been paying for its decision to sue since filing the lawsuit in March.
UnitedHealthcare's parent company, UnitedHealth Group, dropped its bid to acquire Envision's ambulatory services unit after the lawsuit was filed. Additionally, Envision's stock fell 7% after UnitedHealthcare made the decision to terminate the contract altogether and is yet to fully recover.
The payer has scrutinized Envision with allegations of balance billing, when patients are surprised with a high medical bill after seeing a physician (often from a staffing company) they didn't realize was out of network. The practice is fairly common: A National Bureau of Economic Research study found that patients who visited in-network hospitals for emergency care received care from out-of-network physicians 22% of the time, without any means of avoidance.
Envision has been criticized for balance billing via Emcare, a subsidiary that provides hospitals with emergency room physicians. A group of investors filed a lawsuit against Emcare last year after the New York Times brought the practices to light. According to those investors, Emcare's "revenues were likely to be unsustainable" because of the negative publicity.
Envision has said it wants a new agreement proving "fair and reasonable" reimbursement for services. The federal court's decision to dismiss Envision's lawsuit and force arbitration will leave the provider with little leverage while meeting UnitedHealthcare at the negotiating table.