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UnitedHealth will pay to improve reimbursement database

UnitedHealth Group will spend $50 million to create a new database that’s used to set how much patients pay out-of-pocket when they visit out-of-network doctors.

The announcement is part of a settlement with the New York attorney general’s office. Officials were investigating complaints about the database, which is managed by a UnitedHealth unit called Ingenix and used by the entire health-insurance industry.

New York AG Andrew Cuomo tells the New York Times his office’s investigation was like “pulling back the curtain on the wizard of Oz.” The database was “created in a well of conflicts” and produced information that was “unreliable, inadequate and wrong.”

Insurers typically pay 70 to 80 percent of local “reasonable and customary” rates for non-network visits. Cuomo said the Ingenix database “consistently low-balled” the cost of services, robbing consumers of hundreds of millions of dollars.

UnitedHealth did not acknowledge wrongdoing and said it stood by the quality of the database. The company doesn’t face criminal charges, but it is dealing with several lawsuits about disputed reimbursements.

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