Ingenix

Ingenix is a a health care information, technology and research company that is a wholly-owned subsidiary of UnitedHealth Group. It was founded in 1996, and is a a $1.7 billion arm of UnitedHealth. Ingenix collects, sorts, and analyzes a large array of healthcare-related data, including therapeutic outcomes and billing information.

The CEO of Ingenix, Andrew Slavitt, was formerly a chief executive at UnitedHealth Group. He was named CEO in 2006. Prior to his position at Ingenix, Slavitt was founder and chief executive officer of HealthAllies, a health care benefits company that was acquired by UnitedHealth Group in 2003. Prior to founding HealthAllies, Slavitt served as chief operating officer and director of Paula Financial. He also worked as a strategy consultant with McKinsey & Company, a global consulting firm that caters primarily to the Fortune 100, and he was an investment banker with Goldman Sachs.

Fraud lawsuits
On February 13, 2008, New York State Attorney General Andrew Cuomo announced the state was expanding an investigation that focused on Ingenix. After an initial six-month investigation, the AG filed lawsuit against Ingenix. At a briefing held on February 13, Cuomo stated, "This involves fraud in the hundreds of millions of dollars, affecting thousands and thousands of families ... Too many people have been hurt. It has to stop. We believe there was an industry wide scheme perpetrated by some of the nation’s largest health insurance companies to defraud consumers."

How the fraud was alleged to work
In describing the alleged fraud committed by Ingenix, Mr. Cuomo described a typical scenario, where an out-of-network doctor might charge $200 for an office visit but is told that the going rate is $77. The insurer would then normally pay only 80% of that figure, leaving the patient responsible for the difference of about $138. At the heart of the state's lawsuit was how that $77 rate got set in the first place: the number was derived from a database of claims data created and maintained by Ingenix, and sold to other insurers.

In responding to the Attorney General's allegations, UnitedHealth said it believed it was delivering "dependable database tools." Moreover, the company claimed that "the reference data is rigorously developed, geographically specific, comprehensive and organized using a transparent methodology that is very common in the health care industry." However, Linda Lacewell, who headed AG Cuomo's healthcare industry taskforce, accused UnitedHealth of lying to consumers. She described the Ingenix database as "garbage in, garbage out." Another source reported Ms. Lacewell's description of Ingenix and UnitedHealth's use of data as "deception, manipulation of data and outright fraud."

Additional health insurers implicated in suit
Cigna and Aetna were also the targets of lawsuits over the Ingenix database, which was apparently used by many large health insurers to determine reimbursement rates. The lawsuits were filed by the American Medical Association (AMA) as well as several state associations, which claimed that the Ingenix database was rigged to underpay doctors on out-of-network claims for more than a decade.

Resolution
In January of 2009, the New York Attorney General reached a settlement with UnitedHealth in which the company agreed to pay $50 million to set up a new database for determining reimbursement. The database was to be owned and operated by a non-profit organization in an attempt to eliminate insurance company conflicts of interest.

Related Sourcewatch resources

 * The Lewin Group
 * UnitedHealth Group

Contact
Ingenix Headquarters Mailing Address: Ingenix 12125 Technology Drive Eden Prairie, MN 55344