Attorney General Mayes Sues MultiPlan and Major Health Insurers for Alleged Price-Fixing Conspiracy

PHOENIX — Attorney General Kris Mayes today announced a 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.
 

“MultiPlan and major insurance companies across Arizona allegedly conspired to keep payments to providers low in a scheme to pad their profit margins,” said Attorney General Mayes. “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. This case is another example of old-fashioned price-fixing using new technology, but it’s against the law all the same.”

According to the complaint filed today, MultiPlan and major insurers used a common algorithm to decide what to pay for out‑of‑network medical care — and profited when those payments went down.

How the Alleged Scheme Worked:

• MultiPlan guided insurers’ price setting for out‑of‑network care:
  • Instead of setting their own reimbursement rates, insurers followed MultiPlan’s pricing recommendations, participating in the coordinated effort to reduce prices through MultiPlan’s algorithm.
• The algorithm consistently recommended extremely low payments:
  • MultiPlan’s system produced a unreasonably low payments for each medical code, no matter where the out-of-network care was delivered or who provided it.
• Every insurer using MultiPlan paid similarly restricted amounts:
  • Providers across states and insurers received payments calculated by the same algorithm that was designed to underpay them — meaning competition effectively disappeared.
• Insurers shared confidential data to keep payments aligned:
  • Insurers supplied their internal claims and payment data to MultiPlan, which pooled and used it to power the algorithm and keep the entire industry paying low amounts.
• MultiPlan recycled low payments back into the system:
  • Each artificially low reimbursement was fed back into the algorithm, pushing future payments even lower.
• Providers had no meaningful way to negotiate:
  • Doctors who challenged low payments were faced with MultiPlan employees whose bonuses relied on low payments and who used aggressive pressure tactics to force acceptance.
• Patients were left paying more:
  • Because insurers paid so little, some patients —who already paid higher premiums specifically for out‑of‑network coverage — were stuck with large medical bills.
• Providers were financially strained, especially in rural areas and mental‑health clinics:
  • Underpayments pushed providers to cut services especially those in already‑vulnerable communities.
• Insurers and MultiPlan profited from paying less:
  • MultiPlan charged insurers a percentage of the money “saved” by paying doctors less — and insurers charged employers their own “shared savings” fees.

The State’s complaint alleges these actions violated Arizona laws:

• Arizona Uniform State Antitrust Act:
  • By coordinating through a shared algorithm and exchanging confidential, competitively sensitive data, the companies allegedly acted together rather than competing, suppressing payments across the market.
• Arizona Consumer Fraud Act:
  • Insurers allegedly misrepresented the value of PPO coverage and hid the fact that a third‑party algorithm — not the insurers themselves — was determining what providers would be paid.

AG Mayes is asking the court to:

• Stop the scheme through a permanent injunction
• Return money to patients, providers, and employers who were harmed
• Force MultiPlan and insurers to surrender profits earned through the unlawful conduct
• Impose civil penalties for violations of Arizona antitrust and consumer‑protection laws

A copy of the complaint filed today in Maricopa County Superior Court is available.