Healthcare Finance & Economics
The $200 Billion Healthcare Cartel Destroying Your Doctor: The MultiPlan Lawsuit with Matt Lavin
February 26, 2026
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A single intermediary company touches an estimated 80% of all out-of-network medical claims in the United States, yet most doctors have never even heard of it. To help us understand the massive MultiPlan lawsuit, we sit down with Matt Lavin, a partner at Gilbert LLP and the lead antitrust attorney at the center of the battle. He breaks down how this obscure pricing system might be quietly draining hundreds of billions of dollars from American medicine.
Throughout the episode, Lavin explains the exact mechanics of how commercial health insurance companies process out-of-network claims and why the system is drawing scrutiny from the Department of Justice. He reveals how proprietary algorithms are allegedly used to aggressively suppress healthcare reimbursement rates, creating massive fees for insurers while leaving providers struggling and patients stuck with the balance. We also unpack the hub-and-spoke cartel theory that forms the foundation of this case, detailing the real-world financial impact on rural hospitals and private practices.
If you are an independent physician dealing with unpredictable revenue or a practice manager trying to make sense of mysteriously slashed payments, this episode is for you. You will walk away with a clear understanding of the hidden corporate forces driving down your revenue and practical advice on how to audit your past claims to protect your business.
About Matt Lavin:
Matt Lavin is a partner at Gilbert LLP’s Washington, D.C. office. He has successfully resolved countless reimbursement disputes with commercial payors such as Aetna, Anthem, AmeriHealth, Ambetter, Beacon, Centene, HealthNet, Humana, Cigna, UnitedHealthcare, HealthNet, Magellan, and many Blue Cross Blue Shield entities and Blue Card Network plans. Matt has experience with practically every aspect of the business of healthcare and revenue cycle management and has handled suits against “cost-containment” vendors, like MultiPlan, that egregiously underprice the value of out-of-network claims.
Episode Resources
Introduction to Value Health Voices
Dr. Anthony Paravati: Amar, it's great to be back with you recording another episode of Value Health Voices. This episode tonight, in some ways, is in our wheelhouse because we love to talk about healthcare finance, but in another way, it's really new for us. And what I mean by that is we have talked so much about the games health insurance companies play to not pay. And tonight, we're going to hear about a new approach from our guest, Matt Lavin.
Dr. Amar Rewari: Yeah, it was really interesting because, as you mentioned, we talk a lot about Medicare Advantage and Medicaid, but we don't really talk about the commercial side as much. It's a little bit of a black box for me as well. And to hear about how prices are negotiated, particularly around out-of-network claims on the commercial payer side is going to be fascinating for our viewers and listeners.
Dr. Anthony Paravati: Yeah, that's right. This episode is going to be all about private payers or commercially insured. What happens in the commercial insurance market. Matt Lavin is our guest. He's a partner at Gilbert LLP. And he spent many years of his career as a lawyer focusing on healthcare reimbursement cases, and particularly healthcare antitrust. And that's really what this is all about.
Essentially, he's going to describe to us in our interview with him, an intermediary company, which first called MultiPlan, later called Claritev, that is acting essentially to invent a deeply discounted price off of what the physician and the hospital bills for care provided to out-of-network patients.
Dr. Amar Rewari: Exactly. And that pricing, we'll talk about what goes into that pricing model. Is there really any data that goes into it? Who this case represents, which is about 450 plus provider groups who are filing the suit, including some involvement from the DOJ, from what I understand.
Dr. Anthony Paravati: Right. Yes. He mentioned to us, it's legal jargon that has already escaped me regarding the federal government's statement of interest to the case. But in any case, the federal government's very interested. They're watching. We know the federal government is interested in this space from many angles, going back to the whole Medicare Advantage thing. That's where they're the most interested.
So the implications here are huge. And more than just the implications, the financial impact of this is on the order of hundreds of billions of dollars annually. Isn't that amazing? U.S. health care system is so big that just this one actor and the influence they have on the prices that are paid is in the range of hundreds of billions of dollars. Just mind boggling.
Dr. Amar Rewari: Yeah. And the way it's going to be described will be in the terms of a cartel, because it's that same kind of concept where there's collusion about pricing potentially or allegations around collusion between the insurers as part of this antitrust, anti-competitive pricing.
Dr. Anthony Paravati: You know, perhaps the only thing missing from the cartel analogy, because otherwise I think it's quite good, is agreeing to something and then producing more. You agree on a price and then you're producing more and maybe even selling your oil in the case of a cartel in whatever currency you want rather than U.S. dollars. Who knows? That's where it breaks down. But it's interesting anyway. And we cover ground that really directly states how all stakeholders in healthcare, other than perhaps the insurance companies themselves, are hurt by the actions of this intermediary.
Dr. Amar Rewari: Correct. Provider groups potentially going out of business because they're not being compensated fairly for the work they're providing in these out-of-network, as well as community hospital systems, rural hospital systems. So there's definitely an impact on providers and patients, obviously, as well, who get stuck with the bill.
Dr. Anthony Paravati: Yeah, that's the part that wasn't clear to me at first, is that difference from the discount that Claritev is essentially inventing is ultimately the hospitals. And they'll do this with different levels of aggressivity, depending on what hospital system and physician group is involved. They're seeking to be made whole off the backs of the patient. So there's a financial toxicity element here as well.
Dr. Amar Rewari: Yeah. And a disclaimer, once again, since it's been a while since we've put this out there that these opinions are all of our own, not representing any organization we work for or are involved with.
Dr. Anthony Paravati: I'm glad you said that because I did make some opinions very clear tonight, I guess, as is my tendency. So, Amar, you're saving me. So thank you. To the extent that one can be saved by such a disclaimer. Well, listen, I think we should, without further ado, get right into it.
The Role of MultiPlan in Healthcare Reimbursement
Dr. Amar Rewari: Let's do it. So there's a single company that touches over 80% of every out-of-network medical claim in America. Most doctors have never heard of it, and according to a major federal lawsuit, it may have been quietly stealing billions from the healthcare system for years. Today, we're talking to the lawyer at the center of that fight. But before we get into details, in the simplest terms possible, what is actually happening here? Matt, what do you allege?
Matt Lavin: So there is a company that's been around for almost 30 years called MultiPlan. MultiPlan works in the shadows of healthcare reimbursement. And what MultiPlan does is it prices out-of-network claims for the big commercial insurance companies. So think of United and Cigna, Anthem and Aetna and your local Blue Cross Blue Shield in your state.
Most of the claims that they get on a daily basis, maybe 90 some odd percent of them are in-network claims. But there's a big batch, a big world of out-of-networks. Maybe you've seen a doctor who's not in-network with your insurance. Well, 80% of those claims for commercial insurance companies, MultiPlan is the one who's actually pricing the claim and coming up with the amount of money that your insurance company is going to pay to that doctor.
Dr. Anthony Paravati: So more or less what they're doing, and we're going to have plenty of chance to get into this, is they're using some proprietary way of arriving at a price that they unilaterally decide. Is that what it is, Matt?
Matt Lavin: That's what it is. So MultiPlan has a variety of techniques that it uses. Some are algorithms where it takes data sets and manipulates the data sets just to come up with a reference point for pricing health care claims.
Some other methodologies that it uses is something that they call negotiations. But in reality, what MultiPlan does is it uses data that it's gathered from all the insurance companies about a particular health care service and particular health care providers. And then it negotiates with that provider based on the lowest amount that it's ever paid to that health care provider.
Dr. Anthony Paravati: Yeah, that's very interesting. So this is effectively an issue of antitrust. Is that correct? And is that the area that we're in here?
Matt Lavin: Yeah. So we allege in our case is that MultiPlan has been working effectively as the middleman between all the big health insurance companies to determine what those health insurance companies are going to pay out-of-network doctors and hospitals and other health systems.
The reason that that is what we would call an antitrust or an anti-competitive behavior is that all the health insurance companies in this country—the Cignas, United, Aetnas, Anthem—are actually competitors. So they're competitors in a marketplace. And whenever competitors get together to fix the prices, to coordinate pricing for goods or services, not just in healthcare, but in any industry, that is an anti-competitive act that's subject to the antitrust laws of the United States. So that is, at its core, what this case is about, that MultiPlan is going around coordinating pricing of healthcare claims between competitors in the marketplace.
Matt Lavin’s Background in Healthcare Antitrust
Dr. Amar Rewari: Gotcha. And before we do a little more of a deep dive into that, I'm just curious about your own background. Matt, what made you get into healthcare antitrust and what drew you to this specific case?
Matt Lavin: That's a good question. So for a very long time, I'd done all different legal things. And about 10 years or so ago, I think we've all received them in the mail. I've got kids and a family. And I would receive these explanations of benefits in the mail. And you've gotten them for every time you've ever gone to the doctor, if you've got health insurance. It says your doctor charged this and we paid this and you owe this and there'd be codes across the bottom.
They didn't make any sense to me. And I used to think that I'm an attorney who works on a lot of high-level insurance issues. If I'm confused, I'm going to guess that everybody's confused. And like a lot of American consumers, I would just always assume that, well, it's the insurance company. They know what they're doing. They're super sophisticated, right? They must know what the rules and the laws are.
I come to find out after years of doing this, that in a lot of times, like with MultiPlan, they're just making stuff up. And this is all about just making money for the insurance company. Shouldn't be a surprise, but I guess that I assumed as a consumer of American health care insurance, something different.
I also started to get a lot of clients that would come to me and talk about their issues with health insurance companies. I represented a lot of health care providers and worked with a lot of health care providers. And over and over, I would hear about problems with particular insurance companies, the difficulties they had getting paid.
Another thing that became clear to me is that healthcare providers and doctors and health systems are real good at providing healthcare. And that's what they get into the business for. They're in the business of treating patients and helping people get better. But when it came to working with the health insurance companies, there weren't many attorneys or just anybody out there who had a lot of expertise with how healthcare reimbursement works. And it's complex, it's not intuitive, and it can be dry. So I started to work with clients who had reimbursement issues in different insurance companies, began to learn more about how the sausage is made and how those claims are paid. And a lot of the things that I found out were really surprising to me.
Discovering the Scale of the Problem
Dr. Anthony Paravati: Yeah, that's it. I'd like to get into that next. So what was the moment that you realized with this case, the scale of what you were looking at here and that you had to say to yourself, all right, I got to carve out a segment of my career to fight this and solve this?
Matt Lavin: Well, it's not just that I've got a lot of cases, a lot of clients with health care reimbursement issues, but there certainly are trends in health care amongst the commercial payers, things that I would see with my clients. And going back six or seven years, around 2017 or 2018, I started hearing a lot about a company called MultiPlan, and particularly one of their services, which is a service called Viant.
And what Viant does is it prices what are known as facility claims for healthcare providers and for clients. Anybody who might not be familiar with it, in healthcare, there's basically two types of claims that can be made by a healthcare provider to an insurance company. One is what's known as a professional claim, a doctor's services. The other is known as the facility claim, so what a hospital would charge.
The example that I often give people is I was on a business trip a couple of years ago and my appendix exploded while I was in a hotel room on a business trip. Horrible. Had to go to the hospital, of course, get my appendix removed. But when I got home, I got a bunch of different bills. And some of those bills were from the surgeon who removed my appendix. Those are professional claims.
And then I also got bills from the hospital just for staying in the hospital. And those are what they would call facility claims. So I started to hear a lot about this company called Viant that was paying healthcare providers 2%, 5% of what they had billed on out-of-network claims and how all these healthcare providers could no longer offer certain services to patients because of how low they were suddenly getting paid on these claims. And so that's around when I started to do some digging on this company called MultiPlan. And it turns out MultiPlan owns Viant as well as a bunch of other subsidiary companies that he uses to do this pricing.
How Out-of-Network Claims Are Processed
Dr. Amar Rewari: So you bring up the claims a lot, and I think maybe it'd be helpful for our listeners to understand that system a little bit more. So maybe you could walk us through what that means step by step from the moment a doctor submits a bill to when the reimbursement comes in. How does that claim go through the system?
Matt Lavin: Sure. So you go to a doctor and you've got insurance, and that doctor may or may not have a contract with your insurance company. If that doctor does have a contract, it's known as an in-network claim. If the doctor doesn't have a contract, it's known as an out-of-network claim. So after the doctor or hospital provides their services, they send a bill to your insurance company.
Your insurance company then gets that bill, that claim, we would call it. They look at it and they say, okay, this doctor, this health system, we either have a contract with or we don't. If we have a contract, if we're in network with them, well, now we've agreed to certain rates and those are what we're going to pay for the service. And you're probably going to have a deductible and the doctor will bill you because the insurance company isn't going to pay that part of your claim that's your deductible or co-pay.
But then there's another huge segment of healthcare for out-of-networks. So the health insurance company may get that claim and they may say, well, we don't have a contract with this doctor and therefore we've got to figure out what we're going to pay for this. For many, many years, out-of-network was paid to health care providers as a percentage of their billed charges—say they would just pay 80 percent or 50 percent of the health care charge.
But around 2015, this company called MultiPlan really got onto the scene and started using these pricing tools and pitching them to health insurance companies. They say, hey, let us come up with a price. If MultiPlan is coming up with a price, what happens is the health insurance company gets the claim. They see that the doctor is not in network. They send it to MultiPlan. MultiPlan uses one of these pricing tools, comes up with a number, sends that number back to the insurance company. That number goes on to an explanation of benefits, and then that number is what they pay the doctor.
Dr. Anthony Paravati: So more or less what they're doing, and we're going to have plenty of chance to get into this, is they're using some proprietary way of arriving at a price that they unilaterally decide. Is that what it is, Matt?
Matt Lavin: That's what it is. So MultiPlan has a variety of techniques that it uses. Some are algorithms where it takes data sets and manipulates the data sets just to come up with a reference point for pricing health care claims.
Some other methodologies that it uses is something that they call negotiations. But in reality, what MultiPlan does is it uses data that it's gathered from all the insurance companies about a particular health care service and particular health care providers. And then it negotiates with that provider based on the lowest amount that it's ever paid to that health care provider.
Dr. Anthony Paravati: Yeah, that's very interesting. So this is effectively an issue of antitrust. Is that correct? And is that the area that we're in here?
Matt Lavin: Yeah. So what we allege in our case is that MultiPlan has been working effectively as the middleman between all the big health insurance companies to determine what those health insurance companies are going to pay out-of-network doctors and hospitals and other health systems.
The reason that that is what we would call an antitrust or an anti-competitive behavior is that all the health insurance companies in this country—the Cignas, United, Aetnas, Anthem—are actually competitors. So they're competitors in a marketplace. And whenever competitors get together to fix the prices, to coordinate pricing for goods or services, not just in healthcare, but in any industry, that is an anti-competitive act that's subject to the antitrust laws of the United States. So that is, at its core, what this case is about, that MultiPlan is going around coordinating pricing of healthcare claims between competitors in the marketplace.
The Pricing Algorithms and Fee Structure
Dr. Anthony Paravati: Yeah, I really want to understand, if you can tell us, Matt, whatever this scheme, this algorithm they're using, what's actually going into it? So what inputs go into it? We've heard about what you just said, what comes out of it, a very low price at a very low percentage of what was billed. And do we have any insight into what it optimizes for other than just the lowest price? Meaning, are there certain scenarios where they would pay much higher, others where they pay very low? Can you tell us anything about that?
Matt Lavin: Yeah. So a little bit about that. I think one of the things that's important to understand, and I could talk about what goes into those different pricing tools, is that MultiPlan and the insurance companies make money based on how low they can price a claim.
So let me give you a quick example. If there was a physician that submitted a claim to the insurance company for $1,000 for a service and that doctor is not in network with the insurance company, the insurance company sends it to MultiPlan, who then uses one of its pricing tools, which I'll talk about in a minute, to price that claim. Let's say it comes up with $100. MultiPlan takes the $100 number, sends it back to the insurance company. Insurance company pays the doctor $100. But now you've got a delta between what was originally billed on the claim, the $1,000, and the new price that MultiPlan's come up with, the $100.
MultiPlan and the insurance company then charge the employer who sponsors that health plan a fee. Most Americans with commercial insurance actually have it through an employer. Although of course there's Affordable Care Act plans and 20 million Americans insured on those, there's 80 or 90 million Americans with employer health plans in this country. They then charge the employer a fee for underpaying that claim. And that can be as much as 35%. So in that example, MultiPlan and the insurance company will charge the employer 320 some odd dollars, 35% of the 900, while paying the doctor $100.
And now you've also got a balance due. In many scenarios, the healthcare provider is kind of stuck and they have to send a bill or they're able to send a bill to the patient. And collecting on patient bills is a near impossibility for healthcare providers, even for those healthcare providers that are able to bill.
But how does MultiPlan come up with those numbers? So they use different data sets, some things that they purchase from CMS, Medicare data. They might use private data on Medicare claims to price claims. They may be calling up and using co-mingled data. They may be calling up health care providers and looking at co-mingled data that they possess on how the health insurance companies have been paying doctors for certain services.
Any one of those tools they may use, but you got to remember, when you're working with data, you can make numbers say whatever you want. They apply modifiers to that data and make it pay lower. They may pay only a certain low percent that they don't disclose of that data. So it's not like they're just comparing apples to apples and coming up with prices. They're using a bunch of tools to essentially manipulate that data to get it to a number that's as low as they possibly can so they can maximize the fee that they charge because, of course, their fee is based on how low that claim was priced.
Dr. Anthony Paravati: You can see me, Matt, squirming in my seat because there's a lot of things you said there that are making me nervous. They're starting to sound like a real problem. And I want to highlight them really explicitly for the audience.
You mentioned it and we glossed over. This is one line of review. You talked about all the individuals in this country that are covered by commercial insurance through their employer. So we have to remind, there's a distinction there. There's the self-insured approach that many people get. So really their payer of their healthcare is actually their employer. They're self-insured. I mean, places like Ohio, where I live, Indiana, Michigan, we don't have a lot of high margin, large companies like NVIDIA here, right? NVIDIA is not self-insured. They're fine with the fully insured plan. That's the other one. The fully insured, that's much more expensive. In that case, the company isn't bearing any of the risk. They're simply offloading all the risks. The risk-bearing entity is the household name insurance companies that we all know about. So that's the distinction.
And what you just talked about there is that the self-insured plan is contracting with what is called MultiPlan. Now it's Claritev, correct? And those guys are coming up with a new price, deeply discounted. And for this discount then, they're charging a fee back to the self-insured payer for the favor of getting them this big discount. This fee is based on who knows what.
And so really the insurer is then on the hook to then pay this fee to this company. And then the patient themselves are on the hook for the difference in what was billed versus what the hospital system and physician were actually paid. So basically everybody's getting hurt in this except the insurance company and of course the actor here, MultiPlan slash Claritev. Do I have that right?
Matt Lavin: Yeah, I mean, that's true. So, I would say employers don't contract with MultiPlan. If I'm an employer, I don't know how to handle health benefits. That's why I hire Cigna, Aetna, United, Blue Cross Blue Shield. I hire those people to administer my health benefits for my employees. And it's those insurance companies that are then working with MultiPlan.
Very few if any employers I've ever run across know much or should know anything about MultiPlan. They know that they got United or Cigna or Aetna to come in and handle their benefits. I would just say that MultiPlan also does this for the fully insured products to save money. But of course, they're in that case being the health insurance company that's paying a fee on that stuff.
Insurer Oversight and Responsibility
Dr. Amar Rewari: Once MultiPlan makes this recommendation, it's a recommendation to the insurer that this is the price that's set, or does the insurer have an obligation that that is the new price? Is it ultimately up to the insurer to say that we agree with MultiPlan's price?
Matt Lavin: So the insurer, of course, ultimately is responsible for the amount that it pays. But I think it's important to remember that they hire MultiPlan for a reason. And they hire MultiPlan to price these claims.
And our allegations in the complaint are that there is effectively no review of MultiPlan pricing when it comes over, which makes sense. I mean, we're talking about millions of claims a year. You can't have somebody in the back office over there at Aetna sitting around and weighing every single claim. The allegations that we make in the case is there is effectively no review of these claims. MultiPlan has exercised a level of discretion to just price them. And that price is going directly onto a remittance to the doctor, essentially the doctor's receipt for the claim and the payment for the claim. And there's very little oversight. And that's why you hire MultiPlan, right? You want to hire MultiPlan to price these claims so that you don't have to do it yourself.
Allegations of a Price-Fixing Cartel
Dr. Amar Rewari: And just so I can be clear, is the suit against MultiPlan or Claritev for this antitrust pricing or is it also against any of the insurers for a lack of oversight and review of that pricing?
Matt Lavin: So it's both. So it's what we allege is an antitrust, a cartel, an antitrust conspiracy to fix prices.
Dr. Anthony Paravati: It certainly sounds like it, to be honest with you.
Matt Lavin: Yeah. The defendants in the case are, of course, MultiPlan. And the case is named In re MultiPlan Antitrust Health Provider Insurance Litigation. Also involved in the cartel and really what happens with antitrust conspiracies is you have all the insurance companies. And one of the things that the court noted in a recent ruling in June of last year was that just by signing up with MultiPlan, all of the insurance companies, as we allege, could be assumed to be agreeing to participate in this cartel.
If I'm a big health insurance company, the reason I sign up with MultiPlan is because I know that MultiPlan is doing the same thing for my competitors. I also know that MultiPlan will likely give me information that'll tell me how my competitors are pricing these same claims. So that level of market intelligence being shared between competitors, that is what's a violation under the federal antitrust laws.
Interaction with the No Surprises Act
Dr. Anthony Paravati: Yeah, you explained that very well. And the other thing to me that strikes me about this, and I could certainly go through a practical example, but we've already really been talking about it. Patient comes in, out of network, service is provided. Amr and I are both oncologists. We provide cancer care to the patient, out of network. We send out a bill with a certain price. The insurance ends up paying whatever they want by this mechanism we've just gone through.
But don't we have already a mechanism because of the No Surprises Act? We have a mechanism that's supposed to work, a process for independent dispute resolution called the qualifying payment amount. It's a benchmark, let's say. But in this situation, essentially that process isn't being followed. This algorithm is usurping a federal statute, not even, let's say, a rule, but truly a statute that's passed and in place. Am I right here? Is that even relevant or is that not relevant?
Matt Lavin: It is relevant. So since 2022, there's been a law in effect called the No Surprises Act. And what that law does is it applies mostly to hospital-based providers. So physicians like yourselves who would work in a hospital setting.
When those claims are submitted, if the doctor is out of network, the insurance company is required to issue what's known as a qualified payment amount, essentially to treat the doctor as if they're an in-network doctor and come up with some rate that they're going to pay them for every claim. In exchange for that, the doctor agrees not to send a bill to patients. And if the doctor doesn't agree with that payment, they can utilize something called the IDR, the Independent Dispute Resolution Process, which was created by the No Surprises Act.
The thing is, MultiPlan in some cases is calculating that QPA amount. That's another service they offer, not so much a part of this case. But in many instances, what MultiPlan will do is they will reach out to a doctor before there is a payment issued by the insurance company under a QPA payment under the No Surprises Act, and they will effectively try to negotiate the claim.
What we argue is that these negotiations are in many ways extortion. MultiPlan may reach out and say, "Hey, doctor, on that $1,000 claim example that I gave, will you take $100 today? Because if you don't, your QPA tomorrow is going to be 50 bucks."
And they will try and circumvent that process. They are counting on that doctors don't want the hassle of fighting with MultiPlan and fighting with insurance companies. One of the things the court realized in its motion to dismiss ruling back in June, because one of the things the defense has argued is, "Hey, you know what? Yeah, we pay claims low, but doctors, hospitals, they don't have to take it. They could just go fight with insurance companies all day."
And what the court noticed was like, you know what? Most physicians, most hospitals have no realistic alternative but to accept this number and move on. And why is that? Because they've got new patients coming in every day. They've got new claims going out every day. You can only sit around and chase old bills and invoices and accounts receivable for so long that just because of resources, most physicians and hospitals have no option to accept these low payments. And one of the things that we argue is that the data that MultiPlan is using to arrive at these low payments is a commingling of data from competitor insurance companies. So what we allege in our complaint is that they're basically saying, what's the lowest amount that this doctor has ever taken from any insurance company for this service? Let's give them this or something lower.
Proving Collusion Under Antitrust Law
Dr. Amar Rewari: I kind of wanted to go back a little bit to when we were talking about the cartel concept, because just watching all the gangster movies and all that from my youth, I'm just thinking, because as somebody who's not a lawyer, what do you have to prove in court to prove this collusion or coordination of the different parties? What is that bar? What's that actually look like?
Matt Lavin: Well, that is a long, complicated question trying to get into the specifics of antitrust law. But effectively, what we have is a federal law called the Sherman Act, which prohibits antitrust, anti-competitive conduct. Section one of that act is a prohibition on what's known as cartel price fixing. Cartel price fixing is a crime. There's people in prison today for being engaged in cartel price fixing.
Our case is essentially civil liability for what is effectively a criminal act. And in fact, the Department of Justice may be looking at these issues right now as they relate to MultiPlan. There have been Senate hearings on MultiPlan. The Department of Justice actually filed in our case what's known as a statement of interest, which means that the federal government is looking into our allegations against MultiPlan.
But the type of cartel price fixing we're talking about is what's known under law as a hub and spoke agreement in restraint of trade. And you think about it, it's kind of like a wagon wheel. So you've got MultiPlan in the middle and you've got these spokes which are the insurance companies. MultiPlan is effectively, as we allege, passing notes and information between the insurance companies, coordinating pricing on services between competitors.
But then also, if you go back to the wagon wheel analogy, you've also got a rim on that wheel, right? And that rim is an implicit agreement between the members of the cartel, the insurance companies, to all work with MultiPlan and to coordinate their pricing. So what we need to show in this case is that the defendants coordinated their pricing, that they knew about it, that that's why they use MultiPlan, and that the effect of that was to depress reimbursements in the out-of-network healthcare market. So that is what we're trying to show in this case, that it was willful, that it was knowing, that it had actual harm upon the out-of-network healthcare market, and that MultiPlan was the ringleader of it all.
Dr. Amar Rewari: Gotcha.
Financial Impact on the Healthcare System
Dr. Anthony Paravati: In preparing to talk to you, Matt, the research for this topic brought up the number on an annual basis of about $200 billion in annual reimbursements affected by this scheme. Is that right on? Is that number close? And how do we know?
Matt Lavin: I think that's probably... Listen, I don't have all the data. I mean, that number seems right. Healthcare is 20% of the United States economy. It does not surprise me at all that there would be $200 billion. In fact, that might seem a little light, if anything.
If you think of the amount of healthcare claims in this country, there's trillions of dollars a year in healthcare claims in the United States. MultiPlan, by its estimation, prices 80% of all commercial out-of-network claims. MultiPlan's doing itself about 19 billion dollars in underpayments. So I don't know what the total bill charges are in those claims. That could easily be 200 billion dollars or 300 billion dollars that they're touching per year.
Dr. Anthony Paravati: Yeah, it's easy to forget, isn't it, that one out of every five dollars we spend in the United States is on healthcare. And that another way to think about it is that we spend $1 so that the other $4 and the $5 can be produced, right? The whole idea is that we're spending this 20% on the upkeep of the rest of it. I think we're paying too much. How do we get there? I don't know. That's the point of this podcast, I guess, is to figure it out.
Matt Lavin: That's what MultiPlan likes to say. That's what the insurance doctors charge too much. And that's the real problem here. United Healthcare is the third largest company in the United States of America behind Apple by revenue. If you go state by state and look at every state, who is the largest company by revenue in that state? Eight out of 10 times, it's going to be the biggest health insurance company. It's going to be the Blue Cross Blue Shield entities there. Cigna, Aetna.
And what happens is it's not just premiums are how they make money. They make money on fees that aren't even attached to premiums. So in the example I just gave you earlier in this show about they're making $320 on a claim where they pay the doctor a dollar, even though the doctor paid $100, they are making billions of dollars a year on this. And as you can see by that reimbursement example, which is a pretty realistic example, it's not the doctors who are making money on these claims. It's the insurance companies and MultiPlan who are making sometimes three or more times what the doctor is getting paid in every health care claim.
Dr. Amar Rewari: I will say their counter-argument to that, I used to be an investment banker in a previous life, and we used to represent these insurers. Their argument when you look at the books is that, yes, revenue is high, but the expenses are high, so the margins are very slim. That's the counter-argument they like to say.
Matt Lavin: I mean did United have 20 billion in profits last year? Listen, I'm not going to say one thing. It's America. There's capitalism. There is nothing wrong with being a company that needs to maximize profits for shareholders. That is the backbone of the United States economy.
But when you've got a certain section of that, namely commercial health insurers that are so large and so big and the power dynamic is so disparate between the insurance company and the health care provider and the patient... All I do is health care reimbursement stuff for a living. All I represent are healthcare providers. And I get healthcare providers that come to me and they're like, "This insurance company owes me $30 million and they're going to try and do this." And I help. I'm like, I understand, but you got to realize for these big health insurance companies, $30 million is not even a rounding error to them.
Dr. Anthony Paravati: No, it's not. I mean, they're really smart, right? Because the federal government legislated, came up with a situation, created rules where the actual business of processing and paying claims in its own right is kind of a crappy business today. That's why United, Cigna, Anthem, et cetera, they are now not health insurance companies. They are omni-channel healthcare companies, right? Because the services business that they do, the consulting that they do—most of them aren't any good, by the way—all that other stuff is completely unlimited. So that's how you get to a level of such massive profits. The insurance business itself, United Healthcare as part of United Health Group, that's basically the dog of the whole thing, United Healthcare, right? So yeah, I just wanted to call that out for listeners.
Matt Lavin: Cause a lot of them are based on their private equity, their venture capital firms in a lot of ways. United Healthcare is the largest employer of physicians in the United States, 70,000 physicians were there.
Dr. Anthony Paravati: Yes. And that's another matter that the federal government is more and more interested in is, should we force divestiture from provider entities that they've now acquired.
Impact on Healthcare Providers and Patients
Dr. Amar Rewari: When you brought up about the two aspects. One is obviously you have to prove this sort of coordination collusion, and the other is you have to show the real impact it has. Can you describe what you've been finding in terms of that impact, in terms of who's most affected? Like, have you seen practices closed, hospitals closed? How does it split around geographies or rural versus cities or different specialties? Can you walk us through that a little bit?
Matt Lavin: Absolutely. So we've seen a lot of rural health care providers and hospitals forced to go out of business, close their doors. We've seen health care providers in large metropolitan areas where the cost of providing services is high, effectively be unable to stay in those areas anymore to continue providing services because reimbursements are so unpredictable.
Most health care businesses and practices in this country are not giant megacorp hospitals where they can scale. If I'm a giant hospital system with 5,000 beds, I can scale reimbursements. It really hurts independent physician practices, local primary care practices, your urgent care practices, all of those that are operating on thin margins when they can't predict what they're going to get paid by insurance companies. They can't afford to go in-network because in-network rates are so low and they can't scale them and they've got to spend extra money on resources chasing down payments.
It is devastating, especially to mid-sized and smaller healthcare practices in this country. It's also devastating to larger health systems that have a big payer mix and work with a lot of government payers. But I think hit the hardest are like the mid-sized and smaller healthcare practices, where a couple million dollars is the difference between life and death for them.
Dr. Anthony Paravati: You guys, you know, you just bailed me out massively because I was going to make two points, but the second one escaped me. Amr's question perfectly came in because this is exactly what I wanted to talk about.
Another thing that we've covered on the show and other content, health policy and finance producers of content have covered this too, is this disappearance of the independent physician in the United States. And that may or may not result in better outcomes or worse outcomes. I don't know. But it has produced the situation where it's more or less impossible for physicians in many specialties to maintain themselves as independent.
And that has fed this modern era of the mega hospital group. And that's the aspiration, by the way, of the executives in many hospital systems in this country, is to not be a $2 billion hospital system, but to find a way to scrape up to $5 billion, $10 billion, because that's where safety lives, right? At that smaller level, it's very, very tough to compete with the other side of the transaction and all the tools they have to not pay you.
Matt Lavin: Exactly. So, health insurance companies don't make money paying doctors more, right? And what's fascinating is that if you look at any trend, any set of data that you want on physician or hospital reimbursements out of network, in network, either way, it is like going off a cliff over the last 10 years. But at the same time, the cost of providing services has gone up. The consumer price index goes up a couple points every single year.
It has gotten more expensive, not less expensive to provide care. Doctors have to pay rent. They got to pay staff. They got to buy supplies. They got to buy insurance. They got to do all these things, like running any other business, licensing issues, compliance issues. And it's the only business that I can think of where their ability to make money, reimbursements, has gone down at the exact same time that the cost of providing services has gone up.
And it is a dangerous, precarious situation for American healthcare to be in, to the point, to your example, that even these people who run giant hospital corporations, even if they have $2 billion a year in revenue, $5 billion a year in revenue, margins are not gigantic. Margins are thin because it costs a lot to run business at that sort of scale when you're dealing with sick people all day long.
Revelations from Legal Discovery
Dr. Anthony Paravati: Matt, you've done a great job of describing why this is interesting from a legal standpoint, why it's interesting for many stakeholders in U.S. Healthcare system, which is obviously everyone. But what is it? In discovery and working on this case, is there a single thing that just floored you, that just surprised you that this was possible?
Matt Lavin: You know, in this particular case, I see things all the time. I will see something new every single day. There's protective orders and confidentiality orders in the case. But Chris Hamby, reporter from the New York Times, did a series of articles on MultiPlan and others back in April of 2024.
I think that it's not one thing that I've seen. I think it's, in general, the kind of cavalier attitude that insurers have about the American healthcare consumers and about healthcare providers. The derogatory way that they often refer to healthcare providers that they don't like, to patients who are difficult, to even employers who cause quote-unquote "noise" when they complain to the health insurance companies about their employees getting paid.
I think that's the thing that's always kind of surprised me because I've always said to myself, whether I'm taking depositions or something else, like, these people must need to see doctors sometimes too. Like, how can they... to them, it's just everybody's just a data set, a data point. It's the level of indifference to what people who are running healthcare practices or doctors are going through when they're trying to make ends meet and trying to keep their practice afloat. Or the difficulty patients have trying to get coverage, whether it's for cancer, whether it's for life-threatening illnesses. And just internally, it's not any one thing. It's just the ability that they have to kind of step back and the lack of empathy that I often see within executives within health insurance companies.
Current Status of the Litigation
Dr. Amar Rewari: So where's the case stand right now? What's coming up? So just to summarize, you represent about 450 plus physician groups, correct? And you're going up against these super powerful companies. How far along is the case? Where do you see the next steps?
Matt Lavin: So, we represent well north of 450 at this point, there's more physicians and facilities and hospitals signing up every single day.
But right now in the case, we're entering discovery, where we're requesting documents relevant to our antitrust allegations of the complaint from the defendants. And the defendants are MultiPlan and all the largest health insurance companies in the country. The defendants are requesting documents from us. We've got a case management conference coming up on the 27th.
Some of the things we expect will be discussed is how many depositions we'll be taking in this case. I would expect it's going to be close to 300 depositions will be taken in the case, both of the defendant insurance companies and MultiPlan and also of our plaintiffs. Anytime you've got a case where you've got this many plaintiffs against this many defendants, you need to come up with a sample set. So those are called bellwethers. So there's 30, I believe 38 bellwether, 32 or 38 bellwether plaintiffs in the case. So it's discovery on them, depositions and documents and also the defendants.
There's a group of lawyers, it hasn't happened yet, trying to bring a class or a class action related to the case. And next year, the court will rule on that. I and other attorneys, and there's three other attorneys also who have been appointed to lead what are known as the direct action plaintiffs, are leading physicians and health care providers who are filing individually in the case.
Again, the court won't rule on whether there's a class or anything until next year. So we're filing individual cases on behalf of all the physicians that we represent. So that's pretty much what's going on right now. And I would expect through the course of this year, it's going to be focused mostly on those depositions and documents and discovery and data productions from the defendants.
Dr. Amar Rewari: Gotcha.
Advice for Healthcare Providers
Dr. Anthony Paravati: And so what, if anything... It sounds like... At the level of health systems and practice leadership, what should they be doing right now in this space? Perhaps more practically, maybe the advice should be, if they don't already know, do a claims audit and see to what extent you're being hurt by this process.
Matt Lavin: That is a great, great suggestion. So I think my experience is that a lot of doctors aren't aware of what their claims experience is. So talk to your biller, talk to whoever does your billing for you, revenue cycle management. Ask if you've got some kind of out-of-network exposure, meaning you've submitted some volume of claims on an out-of-network basis.
If so, you likely have a lot of MultiPlan pricing. MultiPlan pricing goes on in the background. When a doctor gets paid, that payment comes from the insurance company, even if MultiPlan has priced it. So the doctor may not always know, but your biller may know.
They may have heard of reach-outs by MultiPlan or Claritev or one of their subsidiaries, which include Data iSight or Viant. There's a company called MARS, which MultiPlan often owns, that also does this kind of pricing. We've heard that MARS has gotten very active since there's been so much heat recently on Data iSight and Viant, and the MultiPlan negotiates themselves.
So talk to your biller, see if they've had any interactions with those companies, repricing claims, and then reach out to us or reach out to another attorney to ask for advice on what to do. The claims period that we're talking about here goes back to 2015. So while the No Surprises Act has been around since 2022, we're asking the court to approve a disputed claims period back to 2015. So we're really talking almost 11 years. You may be in network with a lot of insurance companies now, but maybe you were out of network in the past. It's worth looking into whether you've got claims that might be subject to, might be relevant to this case and in the disputed claims period for this case. So I would suggest reaching out to me or some other attorneys. We're happy to discuss these things with you.
Regulatory and Legislative Landscape
Dr. Amar Rewari: So you're obviously focused on this litigation, which makes sense. And it's very exciting to see where this will progress. I'm curious on the regulatory side, is there anything happening on the federal or state level or on the legislative side with either the Congress or state legislatures that are looking at regulating some of this mispricing?
Matt Lavin: So I don't know that there's much going on the legislative side. We have, as I mentioned earlier, there have been House and Senate investigations into MultiPlan. MultiPlan has been subject to subpoenas. I know that Senator Amy Klobuchar from Minnesota referred MultiPlan to the Department of Justice back in 2024. Likewise, The Department of Labor is responsible for overseeing ERISA benefits and the Senate HELP Committee, which oversees employer benefit plans, referred MultiPlan. So I imagine there's a lot going on back there regarding this.
Commercial health care is interesting because there really is not a government agency. And this is one of the reasons for the problems that we have in commercial health care. There's no real government agency that's tasked with, believe it or not, overseeing what the big health insurance companies do. There's certainly on the Medicare side, there's CMS, but as far as commercial healthcare, there really isn't anybody watching over it.
The Department of Labor is responsible for overseeing ERISA benefits, so group health benefits. But the Department of Labor is just looking into the relationships between employees and employers. They're not really day-to-day overseeing what goes on at Cigna and Aetna and Anthem and how they administer these plans. So it's the courts who are kind of tasked with creating balance between healthcare providers and insurance companies.
So to answer your question, I'm not aware of any pending legislation out there. The most recent legislation that's kind of touched on this was the No Surprises Act back in 2022. A lot of that was pushed through by the health insurance companies, right? They really wanted to limit the ability of healthcare hospital-based providers to get reimbursed. They wanted to lower reimbursements, came up with this IDR process. It's interesting because nowadays, it turns out these IDR processes tend to rule in favor of the health providers. So this law that was pushed through by the health insurance company has kind of backfired on them, where all these independent dispute resolutions on claims, the arbitrators are actually ruling for the providers and not for the insurance company. So, it's a remarkable thing to watch just on the No Surprises Act front.
Potential Outcomes and Remedies
Dr. Anthony Paravati: So if what happens, if the courts agree this is anti-competitive, does this entire pricing approach, this algorithm-driven pricing and pricing for multiple different competitors, I presume the model collapses then. Is that right? Or is that hoping too much?
Matt Lavin: Well, so I think that what we're suing for on behalf of our clients are money damages, right? So we believe they were underpaid as a result of this collusion. We believe they should be paid a fair competitive rate for their out-of-network services. So we've got healthcare economists and teams of healthcare experts basically create a model of a "but-for" world. What if MultiPlan hadn't existed for the past 10 years? What would reimbursements look like? And there's tools like Fair Health out there. There's other tools that they can look at to try to figure out what would happen if MultiPlan had not been around, monkeying with out-of-network reimbursements for the last 10 years.
But what we're asking for is for the courts to issue also an injunction against MultiPlan from allowing this collusion between the health insurance companies. There should be real competition between insurance companies, right?
I have been on the benefits committee for a big law firm where I'm on the committee that goes out there and chooses health insurers. Our goal is not to see who can pay the least amount of money so that our employees get crummy benefits and the doctors won't take their insurance. That is not an employer's goal. We want physicians to be paid fairly so that they will continue to treat our employees.
We're hoping that ideally, if there's competition in the marketplace, you've got other efficiencies that health insurance companies can try and affect that don't impact reimbursements, that don't underpay doctors. Because when doctors get underpaid and they don't want to treat patients anymore, they can't afford to treat patients anymore, you get a world where patients aren't getting treated and employees can't get the benefits they want. And employees are saddled with exposure to bills and balances.
Dr. Amar Rewari: So do you have a number that you're giving the courts about what that fair out-of-network market rate is? Are you saying it's 80% or are you guys not going into that specifics?
Matt Lavin: So, we're early in the case and a lot of that's going to depend on analysis of data produced by the defendant insurance companies and MultiPlan and that process hasn't really happened yet. We don't have that data, but when we do get that data, we have healthcare teams of healthcare experts that look at it and they come up with a competitive rate for various services in various geographic areas. If you think about like usual customary reasonable rate, UCR, you've heard about that.
Dr. Anthony Paravati: Right. That's another area. That's a pre-MultiPlan concept.
Implications for the Future of Healthcare
Absolutely. So, we've covered a lot of ground and we're right in that zone of the typical length of our podcast. This has been absolutely perfect. We want to ask you, and this is going to be the last question, I presume. We'd love you to really answer us honestly here. If this case ultimately goes nowhere, if the court sides with the insurers and MultiPlan/Claritev, what does this tell us about the healthcare system? What does this tell us about the future of what it's like for patients to get the care they need?
Matt Lavin: I think the scary thing would be is that it says that the big megacorps can do whatever they want, can collude and conspire in any way they choose to maximize profits for themselves, and that healthcare providers and the ones who are on the front line of actually treating patients, that their interests and their livelihood is not as important as it is for big megacorp health insurance companies. That would be my fear.
I think that what's interesting about this case, in particular, this court and this judge is, as a guy who litigates these issues all the time, the biggest problem I always have is trying to get a court to understand the dynamics of healthcare reimbursement. Paying doctors less is not the answer. It's not the easy answer that it sounds like. There's a difference between overpaying and paying a fair rate to doctors.
And this judge really seems to get it. I think this judge understands that this is important, that this infects health care providers. Health insurance companies are health care payers because their job is to pay health care providers. I think this court finally gets it. So I would hope that we're successful in this case and that the rights of health care providers can be vindicated and they won't be subject to this kind of conspiratorial cartel behavior that's putting them out of business across the country.
Dr. Amar Rewari: I think Anthony just set you up for the closing argument of your case. So there you go.
Conclusion and Contact Information
Dr. Anthony Paravati: It had a closing argument feel, to be honest. Hey, before we finish, where can people follow this case and follow your work, Matt?
Matt Lavin: Sure. So we've got, I mean, I'm at Gilbert LLP, law firm in Washington, D.C. I've got co-counsel at Napoli Shkolnik and co-counsel at Seeger Weiss. There is, I believe, a website. I know that our co-counsel has an inquiry form available where you can write in and we'll reach out to you and help you go through your information.
So I suggest you reach out to me directly. You can find me, Matt Lavin, at Gilbert LLP. There's also, I believe, it's MultiPlan Litigation. You can check that out. One of our co-counsel, Napoli Shkolnik, has an intake form you can fill out online, and we will get right back to you.
Dr. Anthony Paravati: Well, that's excellent. And if you want to send us a link to any of that, we'll put it with the show notes. This has been fun. And, Amar, you and I, we've covered a lot of the, we've even called it games insurers play, but this is a whole new game for us that I have to admit I knew virtually nothing about. And Matt has enlightened us tonight.
Dr. Amar Rewari: It's very true. Well, thank you for coming on, Matt.
Dr. Anthony Paravati: Thank you for having me.
Matt Lavin: I appreciate it. Anytime.
