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Investigators found yesterday that two-thirds of the health insurance industry in the United States uses a faulty database that charges patients more for seeing out of network doctors. The database, operated by Ingenix, kept rates low in order to underpay doctors which then drove up costs for patients.

Ingenix is a subsidiary of UnitedHealth Group which is also used by nearly 20 regional and national health insurers. Ingenix agreed last January to pay $350 million in order to settle allegation that it kept its rate low to underpay doctors.  Other health insurers include Aetna, CIGNA, and Wellpoint.

Health insurers submit information to Ingenix to determine the costs for care received out of network. Health insurance companies often skew data to underestimate the costs of medical services so that patients would have to pay more in out of pocket costs.

“The result of this practice is that American consumers have paid billions of dollars for health care services that their insurance companies should have paid,” states the Senate Commerce Committee’s investigative staff.

“Insurers know that policyholders are so baffled by those notices they usually just ignore them or throw them away,” said Wendell Potter, a former insurance executive at CIGNA. “And that’s exactly the point. If they were more understandable, more consumers might realize that they are being ripped off.”


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