Major Health Care Reform In Ny

01.14.09 | FL News Team

New York Attorney General Andrew Cuomo announced Tuesday that insurance companies have defrauded patients for years by underpaying medical bills. Now health insurers are being warned to change their rates for out-of-network doctors visits.

Cuomo's office found that almost every single major provider in New York participated in the cost-cutting scheme. Insurance companies used the Ingenix system, created by UnitedHealth Group, to determine how much to reimburse patients for visiting out-of-network doctors.  Cuomo said the database set the rates by using "unusual costs" for a service and then manipulating the numbers.

UnitedHealth Group has agreed to shut down the system, and to use a new independent database that is being created. Cuomo said the moves will affect the entire industry, since nearly every insurance company previously used the United subsidiary for reimbursement rates.

Cuomo said more than 110-million Americans have been affected by this "scheme." He is promising the next step will be hundreds of millions of dollars in restitution.