Attorney general sues healthcare firms over price fixing

Mayes alleged the healthcare insurers used an identical formula and data and allocated payment decisions to Multiplan, resulting in limited pay across the industry.

“MultiPlan and major insurance companies across Arizona allegedly conspired to keep payments to providers low in a scheme to pad their profit margins,” said the Democratic attorney general.

“By using a shared algorithm to set payments, these companies harmed doctors and patients alike — driving up patients’ risk of paying more out‑of‑pocket costs, depriving providers of fair payment and sometimes forcing them to accept payment below the costs incurred for treatment, and making it harder for Arizonans to get the care they needed,” Mayes said.

“This case is another example of old-fashioned price-fixing using new technology, but it’s against the law all the same,” the attorney general noted.

According to the lawsuit, over the last 10 years, defendants’ “repricing scheme has placed an enormous burden on Arizona’s healthcare system.”

“Arizona residents bear the costs: patients forego needed treatment and grow sicker; patients accrue medical debt; hospitals and other medical facilities, including state-run facilities, face provider shortages; patients are unable to pay their providers; providers’ quality of care diminishes; hospitals and other medical practices close; and healthcare providers and their businesses cannot make ends meet,” the lawsuit said.

Arizona is asking a court for a permanent injunction against the alleged price-fixing scheme and for the defendants to return money to people allegedly harmed by the scheme. The state is also seeking to impose civil penalties on the defendants and to require them to surrender profits from the alleged scheme.

Jen O’Conner, the vice president of brand marketing for Multiplan, told The Center Square by email that the allegations made by Mayes “are without merit, and the company stands by its position that it complies with state and federal antitrust laws.”

“It is not uncommon to see copycat complaints filed in matters such as these, and similar theories have previously been dismissed by courts,” O’Conner said.

She added that Multiplan “will defend” itself “through the legal process and will not comment further on the specifics of the complaint at this time.”

Multiplan remains “focused on working with clients and partners across the healthcare ecosystem to make healthcare more transparent, accessible, and affordable for consumers,” O’Conner said.

Arizona state Sen. Janae Shamp, R-Surprise, who is a nurse, told The Center Square via email that she is “deeply concerned about any practices that undermine fair reimbursement for providers and drive up costs for patients.”

“While Mayes' lawsuit against MultiPlan and major insurers raises important questions about out-of-network payment practices, it is troubling that she chooses to focus resources here while turning a blind eye to far more egregious and widespread fraud within our state's own government programs,” Shamp said.

“From wasteful spending in Medicaid to unchecked fraud in state contracts and bloated bureaucracies that bleed taxpayer dollars, Arizonans deserve an Attorney General who aggressively pursues every form of fraud — not just politically convenient targets in the private sector,” she noted.

Shamp urged Mayes to “address the real systemic failures in government-run healthcare before lecturing private companies.”

“Our rural hospitals and mental health providers are already strained; selective enforcement only exacerbates the crisis instead of solving it," she said.