The Arizona Attorney General Kris Mayes filed an 83 page lawsuit against MultiPlan and several large health insurers, alleging they quietly built and operated a system that slashed payments to doctors and hospitals — and left Arizonans having to pay more for out-of-network care.

The lawsuit alleges that for years, MultiPlan and insurers Aetna, Cigna, UnitedHealthcare, Humana, Elevance, Molina, Centene, and Health Care Service Corp. relied on a shared algorithm to decide how much to pay for out-of-network care, which relied in part on their collective sharing of confidential, competitively sensitive claims payment information with and through MultiPlan.

Instead of competing or setting payments independently, they allegedly used the same formula and the same data, and delegated payment negotiation decisions to MultiPlan, resulting in extremely low payments across the industry that continued to decrease over time.

This lawsuit targets what the State characterizes as a decade-long buyer’s cartel in the out-of-network healthcare market. The suit draws a direct line to the 2009 Ingenix settlements — in which UnitedHealth Group and co-defendants paid hundreds of millions of dollars for similar algorithmic manipulation of UCR rates — and alleges that MultiPlan “picked up where Ingenix left off.”

Since at least 2015, MultiPlan (operating its “Data iSight” platform) allegedly recruited the nation’s largest commercial insurers into a coordinated arrangement to suppress out-of-network reimbursement rates. The mechanics of the alleged conspiracy are allegedly straightforward:

– –  Insurers fed proprietary claims and pricing data into MultiPlan’s centralized database — information that, in a competitive market, would be closely guarded competitive intelligence.
– –  MultiPlan’s algorithm used this pooled data to reprice every out-of-network claim by CPT code, producing a single fixed rate regardless of geography, provider quality, or market conditions.
– –  Every insurer in the arrangement followed MultiPlan’s pricing output rather than setting reimbursements independently, effectively eliminating price competition among buyers.
– –  Each artificially low payment was fed back into the algorithm, creating a self-reinforcing downward ratchet on reimbursement rates year over year.
– –  MultiPlan’s fee was calculated as a percentage of “savings” generated — meaning its financial incentive was structurally aligned with paying providers as little as possible.
– –  The complaint notes that MultiPlan’s CEO publicly touted a “record quarterly achievement” in Q3 2024 — a $6.4 billion reduction in payments to healthcare providers.
– –  The State alleges that 81% of the out-of-network commercial market is covered by MultiPlan client-payors, giving providers no practical alternative but to accept suppressed rates or forgo those patients entirely.

The complaint identifies three classes of victims:

– –  Providers: Systematically underpaid at rates a 2020 New York State Comptroller study found to be 1.5 to 49 times below UCR rates for 35% of analyzed service codes; rural providers and mental health clinics are described as particularly impacted.
– –  Patients: PPO enrollees who paid higher premiums specifically for out-of-network flexibility were left with unexpected balance bills when insurers reimbursed at suppressed algorithmic rates. The State alleges the scheme was not disclosed to consumers.
– –  Employers and Self-Funded Plans: Employers offering PPO plans and administering self-funded plans through MultiPlan-participating insurers were also subjected to the artificially managed pricing structure.

The lawsuit is based upon two alleged Causes of Action.  Count I — Arizona Uniform State Antitrust Act (A.R.S. § 44-1402): The complaint alleges a per se illegal horizontal conspiracy among competing buyers to fix prices. The relevant market is defined as out-of-network healthcare services covered by commercial and self-funded plans (excluding No Surprises Act-covered emergency services). Civil penalties up to $150,000 per violation are available. Count II — Arizona Consumer Fraud Act (A.R.S. § 44-1522): Insurers allegedly misrepresented the value and nature of PPO coverage by marketing “flexibility” and “freedom” in provider choice while concealing that a third-party algorithm — not the insurer — was determining provider payment rates. Civil penalties up to $10,000 per willful violation apply.

The State of Arizona seeks: (a) full restitution to harmed patients, providers, and employers; (b) disgorgement of defendants’ ill-gotten gains; (c) a permanent injunction barring participation in the MultiPlan arrangement and requiring each defendant to independently establish its own out-of-network rate methodology; (d) civil penalties under both statutes; and (e) attorneys’ fees and investigation costs. A jury trial has been demanded on all triable issues.

The complaint references MultiPlan’s nationwide operations and notes that the same tool produces identical suppression in every state. Other state attorneys general may follow Arizona’s lead, particularly given the AG’s explicit reference to the Ingenix settlements as a template.