In the wake of highly publicized state and federal investigations into health insurers' use of Ingenix databases for determining "usual and customary" charges, the Florida Office of Insurance Regulation ("OIR") is now conducting its own investigation. On July 28, 2009, Florida's Insurance Consumer Advocate sent a letter to Insurance Commissioner Kevin McCarty requesting that the OIR "investigate the nature and extent of the use of the Ingenix databases by health insurance companies in Florida" and asks Commissioner McCarty "to not only recommend solutions for halting this practice but also to work toward securing restitution for Florida consumers who were underpaid by their health insurers." (View the original document for a link to a copy of this letter.) Commissioner McCarty reportedly responded with a letter to the Insurance Consumer Advocate confirming that the OIR is investigating this matter. (See web posting by Health News Florida.) The National Association of Insurance Commissioners has also been monitoring Ingenix-related activity through its Workers' Compensation (C) Task Force, and at the NAIC's upcoming Fall National Meeting, the Health Insurance and Managed Care (B) Committee and the Market Regulation and Consumer Affairs (D) Committee will hold a joint public hearing that will focus on what constitutes a "usual, customary and reasonable" ("UCR") charge, how insurers use such charges, and how UCR practices (including balanced billing) have affected consumers.
No details are available as to the specific nature and scope of the OIR's investigation, and the OIR has not publicly announced which health insurers or other entities (such as third-party administrators of self-funded health plans) are or will be the subject of the OIR's investigation. However, given the publicity surrounding other Ingenix-related investigations, litigation, and settlements, coupled with the OIR's own track record of proactively exercising its broad investigatory powers on consumer protection issues, it can be expected that any such investigation will be thorough and intrusive.
Health insurers and other entities that use Ingenix's Prevailing Healthcare Charges System ("PHCS") or Medical Data Resource ("MDR") databases should expect that areas of focus in any Ingenix-related investigation will include:
- The nature, extent, and duration of the entity's use of Ingenix databases.
- Whether the entity participates in Ingenix's Data Contribution Program, and if so, whether the entity had "scrubbed" the data prior to submission and what certifications were provided to Ingenix.
- The nature of disclosures to insureds regarding how the entity determines usual and customary charges, either in promotional materials or in "Explanations of Benefits," as well as the nature of disclosures the entity may have made to providers.
In cooperating with the OIR in any investigation, the entity should remain cognizant of the possibility of related civil litigation as well as potential criminal investigations. Although information produced to the OIR remains confidential during the pendency of an investigation, any entity providing such information should take precautions to minimize the likelihood that such information will become a matter of public record after the investigation's completion.