On Friday a case was removed from the Supreme Court of Queens County, New York to the state’s Eastern District federal court. The underlying case was filed by Dr. Norman Maurice Rowe and East Coast Plastic Surgery against Oxford Health Insurance Co. and its affiliates. The case alleges that the insurer underpaid billed charges for an out of network medical provider.
Health insurance companies negotiate discounted rates with medical providers in exchange for a promise of higher patient volume. Out of network providers can still treat patients, but the rate at which those bills are paid is not controlled by a contract.
The complaint explained that Oxford Health, acknowledging that its network of contracted physicians does not cover all localities where patients may need treatment, has an industry-standard program for GAP exceptions. Under this GAP exception, out of network physicians agree to provide the services for the in network rate for that procedure. The plaintiffs applied for and received a GAP exception to provide services for a particular patient. After billing, instead of paying at the GAP in-network rate, the defendant paid at a lower rate with no explanation, per the plaintiff.
The plaintiff is suing for breach of contract, unjust enrichment, promissory estoppel, and violation of prompt pay statutes in New York. They are represented by Lewin & Baglio, LLP. The defendant is represented by Robinson & Cole.
