The Guardian · Sept 2024
Hospital gets $421m 'landmark' verdict after insurer found to underpay claims
A Louisiana jury ordered Blue Cross Blue Shield of Louisiana to pay $421 million over underpaid claims to an out-of-network surgical center.
Source: Centers for Medicare & Medicaid Services, FY 2024 Improper Payments Fact Sheet
That figure covers Medicare fee-for-service alone, and it counts errors in both directions. It does not include the commercial claims that are never checked at all.
Underpayment is not an exception. It is a pattern — measured by federal agencies, confirmed by juries, and almost never audited by the practices absorbing it.
Underpayment is not an occasional billing error. It is measured, documented, and reported by federal agencies and independent researchers every year.
Medicare fee-for-service improper payment rate — $31.70 billion in FY 2024.
Source: CMS, FY 2024 Improper Payments Fact Sheet
Average share of in-network claims denied by ACA marketplace insurers in 2024.
Source: KFF, Claims Denials and Appeals in ACA Marketplace Plans in 2024
Of appealed Medicare Advantage skilled-nursing denials were overturned in the enrollee's favor.
Source: HHS Office of Inspector General, June 2024 data
Decline in Medicare physician payment from 2001 to 2024, adjusted for practice-cost inflation.
Source: American Medical Association
When underpayment is documented and pursued, courts and federal agencies have repeatedly sided with providers. These are documented decisions and findings.
Louisiana state court jury · September 2024
A jury found the state's largest insurer had underpaid an out-of-network surgical center for roughly 9,000 previously authorized procedures over ten years. The verdict covered unpaid and short-paid claims. Blue Cross has appealed.
Why it matters: Authorization is not a payment guarantee — and unpaid claims can be recovered in bulk.
U.S. District Court, N.D. Illinois · consolidated 2023–2025
More than 100 provider lawsuits were consolidated against MultiPlan and major national insurers over out-of-network repricing. Providers allege the arrangement suppressed reimbursement by tens of billions of dollars annually. In 2025 the court allowed the claims to proceed.
Why it matters: Out-of-network underpayment is being litigated as a systemic pricing practice, not one-off error.
Federal courts · 2022–2024
The TMA won or partially won every challenge it brought to the No Surprises Act rulemaking, including a ruling that invalidated the presumption favoring the insurer's qualifying payment amount in the federal dispute-resolution process.
Why it matters: The rules governing out-of-network payment have been repeatedly corrected in providers' favor.
Federal class settlement · 2009
UnitedHealth settled allegations that its Ingenix database understated usual-and-customary out-of-network rates. The company shut the database down and helped fund FAIR Health, an independent benchmark. New York's attorney general reached similar settlements with Aetna, Cigna and others.
Why it matters: The benchmark an insurer uses to price your claim can itself be challenged.
Federal Trade Commission · January 2025
FTC staff found the three largest PBMs marked up specialty generic drugs by hundreds to thousands of percent, generating more than $7.3 billion above estimated acquisition costs from 2017 to 2022, plus an estimated $1.4 billion from spread pricing.
Why it matters: In pharmacy, the shortfall is often hidden inside the pricing formula, not a denial code.
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The mechanism differs by specialty, but the pattern is the same: a small per-claim shortfall, repeated across hundreds or thousands of claims, never checked.
How underpayment happens
High-value diagnostics and multi-procedure visits. Payers downcode evaluation and management levels and apply bundling edits to add-on studies. Modifier 25 and 59 usage is a frequent point of dispute.
What an audit checks
Compare every E/M level and add-on study against the contracted or Medicare allowable — level shifts of one tier are easy to miss and repeat across hundreds of claims.
How underpayment happens
Surgical claims carry multiple-procedure reductions, bilateral and assistant-surgeon adjustments, and global-period splits. Implant and post-operative modifiers are commonly mispriced.
What an audit checks
Recompute the multiple-procedure and bilateral math line by line — a single misapplied reduction rule compounds across every surgery in the file.
How underpayment happens
Volume is the exposure. Small per-claim shortfalls — a downcoded visit level, a bundled X-ray, a dropped after-hours modifier — repeat across thousands of encounters.
What an audit checks
Audit by frequency, not by size. The largest recoveries in urgent care come from a few dollars repeated on a large share of visits.
How underpayment happens
Below-acquisition-cost reimbursement, spread pricing, and per-claim fees are written into the contract formula. There is no denial code to appeal — the underpayment is arithmetic.
What an audit checks
Reconstruct the actual acquisition cost and compare it to the remitted amount claim by claim. Federal findings put industry-wide markups in the billions.
How underpayment happens
Place-of-service and modifier mismatches are the leading cause. Audio-only codes are reimbursed at reduced rates, and post-pandemic rate schedules were cut for many modalities.
What an audit checks
Verify that modifier 95 and the place-of-service code match the service actually delivered — a mismatch quietly triggers the lower rate.
Illustrative composites built from typical audit patterns. They are examples of the kind of shortfall a forensic audit surfaces — not results from any specific practice. Every file differs.
Reporting on provider-versus-payer disputes, federal findings, and the litigation reshaping how claims are priced.
A Louisiana jury ordered Blue Cross Blue Shield of Louisiana to pay $421 million over underpaid claims to an out-of-network surgical center.
Denials that were appealed were reversed 95% of the time — raising concern about the denials that were never appealed.
The denial rate for in-network claims reached roughly 19%, with only a small fraction denied for lack of medical necessity.
Physician groups point to the overturn rates as evidence that prior authorization is being used to delay and deny payment.
A federal appeals court invalidated additional provisions of the No Surprises Act rule, continuing a string of provider wins.
More than 100 provider lawsuits allege out-of-network repricing cost providers tens of billions of dollars annually.
The three largest PBMs generated more than $7.3 billion above estimated acquisition costs on specialty generics from 2017 to 2022.
The state's high court is weighing whether to reinstate the verdict as the appeal continues.
The measurement is mechanical: take what was paid, compare it to what was owed, and document the difference.
Every claim is compared against the Medicare allowable for your state and locality, or against the contracted rate you upload.
Letters cite the CPT code, the exact payment delta, and the applicable CMS NCCI edit — ready to submit.
Payer-specific rebuttal language drawn from the arguments that have worked, tracked by outcome.
Claims are identified by ID only. Session data can be purged at any time.
Five steps, start to finish. You do the first two — we handle the rest.
Create your account, add your NPI, and confirm where your practice is located. Two minutes, no paperwork.
Drag in the payment files you already get from the carrier. No patient names needed — claims are matched by ID.
Each claim is compared to what your contract or the fee schedule says you should have been paid. The difference is the underpayment.
Documented appeal letters go to the carrier on your behalf, and we follow every one until it is answered.
The carrier pays your practice directly. You keep the money — our fee is settled only on what was actually recovered.
The questions practices ask before they hand over a single file. No jargon, no hedging.
Payment rules differ by state, by payer, and by network status. The audit applies the fee schedule and prompt-payment rules that govern your location.
Upload an 835 and see the shortfall calculated against the allowable. Recovery is contingency-based — our fee is determined during your consultation based on your specific case, and applies only to amounts actually recovered.