UnitedHealth Group Drops SCOTUS Appeal in Cross-Plan Offsetting Case

UnitedHealth Group has decided not to pursue its appeal to the United States Supreme Court of an appellate court ruling that found United’s policy of withholding payments to out-of-network physicians and doctors in order to recover previous overpayments is not permissible.

As we previously wrote, the case was filed by Dr. Louis J. Peterson on behalf of his patients (Peterson et al. v. UnitedHealth Group, Inc., et al). Peterson argued that United was not permitted to reduce the amount paid for a claim under one employer’s health plan in order to recover an amount that United overpaid under a different employer’s health plan, a practice known as cross-plan offsetting.

United told the court it developed a payment system that allows it (after provider appeals) to offset overpayments from payments due under any United-administered plan, a practice that “has undisputedly saved substantial plan assets over the past decade.”

A trial court ruled in favor of Peterson. United appealed to the Eighth Circuit, which concurred with the lower court ruling noting: “Nothing in (United’s) plan documents even comes close to authorizing cross-plan offsetting …” The court went on to state that “While we need not decide here whether cross-plan offsetting necessarily violates ERISA, at the very least it approaches the line of what is permissible.”

In its May 30 petition to the high court, the health insurance giant argued that failing to permit United from making recoveries among different plans “significantly impedes the effectiveness of offsetting, because benefit payments are usually routed to providers rather than to patients, and each provider sees members of many different United plans.”

United went on to argue that various health plan documents provided United with broad authority to interpret and implement the plan and that this was a sufficient basis to allow United to recover overpayments to out-of-network providers through the use of cross-plan offsetting.

The Eighth Circuit, however, ruled that because there was no specific stipulation as to whether cross-plan offsetting is authorized, United’s use of it as a way to collect monies owed was “unreasonable.”

The Health Law Offices of Anthony C. Vitale represents providers involved in ERISA plan overpayments that have been the subject of cross-plan offsetting.  Contact us for additional information at 305-358-4500 or send us an email to info@vitalehealthlaw.com and let’s discuss how we might be able to assist you.

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