UnitedHealth Group Inc., which on Tuesday agreed to pay $50 million to establish a new database that will be used to determine rates for patients who choose physicians outside the insurance giant’s network, reached a second settlement to compensate affected consumers.  The settlement resolves litigation filed on behalf of the American Medical Association, health plan members, healthcare providers and state medical societies.

 

Attorney General Andrew Cuomo said the agreement marks “the end of a flawed system.” “American patients have suffered from unfair reimbursements for critical medical services due to a conflict-ridden system that has been owned, operated and manipulated by the health insurance industry,” he said.

Attorney General Andrew Cuomo also reached agreement on Thursday with another health insurer, Aetna Inc. The company agreed to pay $20 million to help establish an independent database used for calculating rates. The amount adds to the $50 million UnitedHealth agreed to pay earlier this week to fund the database.  

 

UnitedHealth, the second-largest U.S. health insurer by market value, said it would pay for this settlement with cash on hand. The deal calls for creation of a new independent database, to be run by a nonprofit organization that is still to be selected. The new organization will also have to give patients details about medical costs.

 

According to a statement from the New York Attorney General’s office, the two insurers, UnitedHealth, the second-largest in the country based on enrollment and Atena Inc., the third largest health insurer, provide 70 percent of the billing information that makes up the Ingenix databases.

Cuomo said the deal is “the largest settlement by a health insurance to date.”