Dive Brief:
- A federal judge last week tossed out Aetna’s lawsuit accusing a radiology provider of fraudulently using the No Surprises Act to reap higher reimbursement.
- The CVS-owned insurer first sued Radiology Partners in late 2024, accusing the imaging group of funneling claims through a subsidiary that no longer had an in-network contract with Aetna in order to receive higher reimbursement out of network.
- A judge for the Middle District of Florida dismissed the case on Thursday, saying Aetna should have raised the issue during the independent dispute resolution process, or IDR, set up by the law to settle billing disputes. A similar suit brought by insurer Elevance was also tossed last week after a judge similarly argued that disputes should be resolved during the IDR process instead of in the courts.
Dive Insight:
The NSA, which went into effect in 2022, was designed to protect patients from unexpected out-of-network medical bills.
Under the law, if insurers and providers can’t come to an agreement on reimbursement, both sides file what they believe is a fair price and a third-party arbiter certified by the government chooses an offer.
Though the process has helped patients avoid surprise bills, it’s been dogged by an unexpectedly high number of disputes and complaints from both insurers and providers, which argue IDR unfairly benefits the other side.
A number of lawsuits have been filed over the NSA’s dispute resolution process. Last week, a case brought by another insurer was dismissed after a judge ruled that Elevance subsidiary Anthem failed to prove that billing intermediary HaloMD was gaming IDR.
Now, another insurer’s suit has been tossed out of court. In its complaint, Aetna argued Radiology Partners had created a “staggering” scheme to bilk higher reimbursement from the insurer, first by sending its claims in Florida through a subsidiary that had the most lucrative contracts with commercial payers in the state.
Eventually, Aetna terminated the subsidiary’s in-network contact, forcing it to go out of network with the insurer. But Radiology Partners continued to bill through the subsidiary, filing “tens of thousands” of arbitration requests under the NSA — even for its in-network providers — in a bid to get higher reimbursement through the dispute resolution process, Aetna alleged.
Insurers have long argued that providers exploit IDR to get higher reimbursement for care, given that providers win the vast majority of disputes and tend to receive substantially higher payments compared to typical negotiated payment rates. The amount of disputes and high award amounts created an estimated $5 billion in total costs from 2022 to 2024, according to research published in Health Affairs.
And Radiology Partners files an uncommonly large number of IDR requests — the provider, along with physician staffing firm Team Health, accounted for 43% of all resolved NSA claims in 2023 and 2024.
Aetna’s lawsuit sought to vacate Radiology Partners’ IDR awards. The insurer also wanted damages for the fees accrued from the dispute resolution process, and to limit further disputed claims not yet filed under IDR.
But “while a close call, the allegations presented in the Amended Complaint fail to establish a sufficient basis excusing Aetna from challenging the IDR disputes on the basis that they were wrongfully submitted by in-network providers,” District Judge Brian Davis wrote in the order Thursday.
It’s a similar argument to one that a judge used last week when the court threw out the lawsuit filed by Elevance. Judge Karen Scott of the Central District of California argued that insurers should use the IDR process to convince arbiters that disputes are ineligible, instead of going to the courts.
Radiology Partners said it was “pleased” with the court’s decision.
“The ruling makes clear that this lawsuit could not be used to unwind IDR outcomes after the fact, particularly where those objections could have been raised through the process itself,” Malea Reising, vice president of strategic communications, health policy and advocacy at Radiology Partners, said in a statement.
Aetna declined to comment on the decision.
