Kristoffer Tripplaar/Sipa via AP Images
About three years ago, a UnitedHealth medical director for utilization management (we’ll call him KW) began to suspect that a popular spine surgeon was misrepresenting patient MRIs to make the case that they needed unnecessary spinal fusion surgery in lieu of a less invasive discectomy procedure. Specifically, KW, a board-certified orthopedic surgeon, believed the surgeon was misdiagnosing degenerative disc disease as spondylolisthesis, the much rarer condition believed to have afflicted Luigi Mangione, the 26-year-old engineer accused of assassinating UnitedHealthcare CEO Brian Thompson following a long phase of societal withdrawal, triggered by a flare-up of his unbearable back pain.
But when KW brought up the topic in a one-on-one peer review consultation in early 2022, the surgeon grew combative. If UnitedHealth did not approve spinal fusion surgery and forced him to perform a routine discectomy, the surgeon promised he would intentionally botch the discectomy, ultimately causing the patient to require spinal fusion anyway. “It would be cheaper,” the surgeon reasoned, for UnitedHealth to just approve the spinal fusion off the bat, according to a 2022 lawsuit.
KW, who had come to develop a deep skepticism of the merits of spinal surgery, was shocked, and reminded the surgeon he was being recorded. The surgeon did not back down, and repeated his threat to literally injure his patient in retaliation for being denied the go-ahead to perform a costlier surgery. But when KW shared his recording with the insurer’s fraud, waste, and abuse committee, he was punished and forced to submit to remedial training on how to “de-escalate” adversarial physician interactions, while the surgeon was given nary a warning.
It remains unclear why UnitedHealth sided with a well-remunerated spine surgeon over its own medical director. At the time, UnitedHealth was in the early stages of a surgery center buying spree, and the surgeon’s practice was in talks to sell, so larger forces could have been at play. (The surgeon’s practice ended up selling to a private equity–backed mega-practice called OrthoAlliance.)
“I think they simply didn’t feel like fighting that battle at that point in time,” KW said during a brief conversation on Wednesday, before declining to comment on the specifics of his case, which he dismissed last year after the DOJ declined to intervene.
UnitedHealth works with its vast network of providers to keep driving costs ever skyward, while ensuring that actual care remains tightly rationed and difficult to access.
UnitedHealth is America’s largest health insurer and its most notorious denier of claims. A widely circulated graph developed by the personal finance website ValuePenguin calculates that UnitedHealth denies roughly a third of claims, nearly twice the rate of Cigna and Blue Cross Blue Shield. Denied coverage was the stated motive of the anonymous individuals Thompson’s estranged wife claimed had been threatening the insurance company CEO; “Deny,” along with “Defend” and “Depose,” was written on the shell casings found at the scene of his assassination.
But at least when it came to spinal surgeries, KW—who declined to speculate on Mangione’s state of mind or spine—says working for UnitedHealth felt like fighting the good fight to save patients from unnecessary procedures that often ultimately exacerbate patients’ pain and lead to … more surgeries.
The notion of care denial as a humanitarian exploit might sound preposterous, especially to the multitudes of back pain sufferers currently sharing stories online of debilitating pain prolonged by excruciating rounds of denials and appeals with the nation’s largest health insurer. But at the time of his dispute with the spine surgeon, KW had spent the better part of a decade working as an expert witness for a quixotic lawyer litigating some 580 malpractice lawsuits against Atiq Durrani, a surgeon accused of performing—and almost as often as not, botching—unnecessary spine surgeries on hundreds of patients in Kentucky and Ohio. Durrani had been a “rainmaker” surgeon at numerous Cincinnati-area hospitals whose penchant for over-operating, often after telling patients they would soon be paralyzed if they didn’t go under the knife, was an open secret in the physician community.
“Especially in cities where you have surgeons that are hundreds of thousands of dollars in debt expecting to make a million dollars a year, you get this complex that’s just ever-feeding, and it literally paralyzed the city of Cincinnati, where anytime you brought up the obvious problem that this surgeon was performing all these unnecessary procedures, you were reminded that you work for ‘us’”—the local hospital giants—“and that you’re [inviting] a lawsuit if you don’t shut up,” KW said. “I think that in some respects UnitedHealth is protecting patients from [surgeons like] Dr. Durrani.”
THE REALITY IS QUITE A BIT DARKER. Insurers did virtually nothing to stop Dr. Durrani, who returned to Pakistan to practice medicine—though his old malpractice insurer has kept his old patients in agony by refusing to pay out any of the hundreds of millions in jury awards they have won at trial. As KW’s lawsuit plainly states, insurers did nothing to stop the surgeon he suspected of misdiagnosing his patients with spondylolisthesis. And although UnitedHealth has deployed enormous resources to position itself publicly as a bulwark against price-gouging by greedy physicians and the private equity firms that make a business model out of consolidating specialty practices and jacking up prices, in reality it works mostly in tandem with its vast network of providers to keep driving costs ever skyward, while ensuring that actual care and treatments remain tightly rationed, difficult to access, and plagued by short-staffing.
At the heart of the problem is a decision the Nixon administration made in the early 1970s after a Nixon aide found himself on a flight next to the intellectual godfather of the “health maintenance organization,” a physician policy wonk named Paul Ellwood. In the few years since Medicare had been enacted, health care costs were ballooning at an impossible clip, and Ellwood’s baby was a blueprint for rewiring the program’s payment structures in an attempt to incentivize doctors to maximize cost savings.
To the Nixon aide, the program sounded like a version of Kaiser Permanente, the vertically integrated health care colossus that dominated California. But Kaiser was a nonprofit entity that employed physicians on a salaried basis and paid them the same each hour, whether performing heart surgery or lobbying a patient with high blood pressure to commit to an exercise regimen—or more to the point, whether they spent it fusing a patient’s vertebrae or merely installing a pain pump. The physicians who went to work for Kaiser were not the sort who would spend their days convincing middle-aged female patients they needed unnecessary hysterectomies, just to run up the tab. (Not that it didn’t happen elsewhere; a highly publicized 1962 review of a Teamsters local medical file determined that a third of the hysterectomies conducted on members’ wives had been unnecessary.)
Ellwood’s vision for health care reform was titanically important, because he designed not only federal HMO policy but the policies of many states. He was the mentor, policy groomer, and employer of Richard Burke, who stealthily founded UnitedHealth in the early 1980s as a vehicle for siphoning funds from the Hennepin County Medical Society HMO.
The flaw in his vision, however, was that it was essentially a plan to contain costs by tweaking the incentive structure for the small percentage of surgeons who routinely prescribed unnecessary treatments or procedures solely to goose their paychecks. Whether or not gratuitous surgeries, treatments, and tests were the primary driver of health care inflation—and there’s plenty of evidence “overutilization” was a big problem in those days—deliberately operating on a patient who doesn’t need surgery was and remains a grave violation of every physician code of ethics and grounds for terminating a license to practice medicine in every state. If the existing systems of public health oversight were insufficient to protect vulnerable patients from being cut open and operated on for no medical reason, then those systems clearly needed to be strengthened and the offending physicians excommunicated from the profession, in the interest of public health alone.
Numbers do not adequately capture the sense of intensifying lawlessness that seems to have pervaded the health care system.
But because the offending physicians were invariably wealthy “pillars” of their community, the scourge of unnecessary health care was treated as a problem of fiscal immoderation, to be tackled by coolheaded technocrats who would design a new system that would tame their prolific scalpels by making the means of reimbursement orders of magnitude more complex and bureaucratic. Spoiler alert: It didn’t work.
A review of more than a dozen whistleblower lawsuits filed over the past decade against UnitedHealth suggests that it has formed mutual relationships with dozens of large physician practices and other provider networks in recent years, in large part because of the increasing focus of Medicare Advantage as the company’s profit center.
The statute that created Medicare Advantage allowed insurers and providers to “share” in the “cost savings” they recognized by decreasing utilization. That’s a problematic notion on its own, but as a lawsuit filed in Colorado in 2015 details, UnitedHealth immediately exploited the “gainsharing” provision to funnel bonuses to physician practices every time they switched a patient to a Medicare Advantage plan. Under the laws that created Medicare Advantage, these kinds of bonuses were supposed to be illegal; they also may violate existing anti-kickback laws.
A 2020 lawsuit filed by two insurance salesmen details the scheme by which a Palm Beach primary care physician named Mazin Shikara—who just downsized from a $27.5 million estate to a mere $16 million mansion—collected some $11 million a year by moving a thousand or so Medicare patients to UnitedHealth and other MA plans. Another lawsuit filed in 2019 by a Georgia insurance agent details the company’s practice of taking nursing home administrators out to Olive Garden and coercing them to hand over their residents’ medical records, so as to convert residents in bulk to UnitedHealth MA plans.
Once the kickback or “gainsharing” relationship is established between insurer and provider, UnitedHealth generally pushes the provider to maximize revenues by upcoding new diagnoses or complications to their medical records. A clinical coding nurse at a newly acquired medical practice filed a complaint in Texas in 2020 detailing the unsubstantiated diabetes, chronic kidney disease, and “broken heart syndrome” diagnoses that began to mysteriously appear in the files of patients who had none of those diseases. A 2023 lawsuit filed by an agent of just-acquired home care staffing agency LHC details how the company overrode her patient evaluations so that “able to dress upper body without assistance” mysteriously became “someone must help the patient put on upper body clothing,” and “is able to use a bedside commode” metamorphosed into “is totally dependent in toileting.”
Still another whistleblower lawsuit filed in 2020 by a nurse practitioner UnitedHealth had stationed at a nursing home details what happened after insurer and provider successfully coaxed a new patient into trading in his Medicare card for enrollment in a UnitedHealth MA plan. After the patient’s loved ones have been pressured into signing a DNR, the full force of the insurance giant’s extensive private equity alliances and robotic patient care algorithms are deployed to ensure that patient is never again admitted to the hospital, even if he or she is obviously suffering a stroke or similar life-threatening condition.
In other words, one riposte to the boomlet of center-left wonks trying to set up an adversarial relationship between cost-constraining insurers and profligate providers, and claiming that providers are primarily responsible for cost inflation, is that the two sides are working in concert, sometimes literally so (UnitedHealth is the largest employer of doctors in America) and more often through kickbacks and glad hands and winks and nods.
THE JUSTICE DEPARTMENT DECLINED TO INTERVENE in any of these cases, possibly because the last time the agency did get involved in a UnitedHealth whistleblower case, over a 2011 lawsuit filed by a top executive named Benjamin Poehling, a California judge dismissed major portions of the case, citing a 2016 Supreme Court ruling that arguably raises the threshold for proving Medicare fraud to permanently unattainable heights. The Justice Department’s annual haul from health care fraud whistleblower settlements and enforcement efforts, the vast majority from out-of-court settlements involving no substantive sanctions or admission of guilt or any of the other sorts of consequences that might constitute a plausible deterrence, shrank to $1.8 billion last year, down from $2.5 billion in 2018, even as the number of new cases filed each week hit a new record.
But numbers do not adequately capture the sense of intensifying lawlessness that seems to have pervaded the health care system. A few weeks ago, federal law enforcement agents finally seized the phone of the cardiac surgeon Ralph de la Torre, whose exploits plundering hundreds of millions of dollars from 40 hospitals while physicians went without pay and patients suffered and died from lack of basic medical care the Prospect has covered extensively. But as yet, de la Torre and his long list of conspirators remain unindicted and free to travel happily between his dozen or so lavish properties and oceanworthy vessels, while his old hospitals have fallen into the hands of operators that have been, yes, accused of performing unnecessary surgeries.
Hundreds of negligence and medical malpractice lawsuits filed against de la Torre’s hospital chain have been rendered essentially worthless in bankruptcy. The same Texas judge is also presiding over the bankruptcies of two prison health care contractors that are seeking to discharge the hundreds of wrongful death and negligence lawsuits of their own. Meanwhile, insiders scheme to keep the hundreds of millions of tax dollars they raked in purporting to provide health care to inmates, then short-staffing the jails so egregiously they routinely died from being denied basic medication. Meanwhile, a peculiar conspiracy of insurers and hospitals has arisen to convince appeals court judges to throw out the dozens of jury awards that have ordered a collective $300 million in compensation for spine surgeon Durrani’s hundreds of victims, 79 of whom have apparently died waiting for justice, and none of whom has yet seen a penny from their courtroom victories.
Years have passed since the expiration of the blanket liability shields that essentially immunized the entire health care system from liability for virtually anything that transpired during the COVID-19 pandemic, and yet the greediest and deepest-pocketed and most prestigiously lawyered have never seemed to enjoy such absolute impunity as they do today. There is no single person or entity to blame for that, but if you had to home in on one, a certain Minnesota behemoth would be the most obvious pick, and it’s not close.
Which brings me to all the media scolds expressing shock and dismay over the outpouring of empathy, solidarity, lust, and other generally positive emotions toward the young assassin of the UnitedHealth CEO. “Violence to combat any sort of corporate greed is unacceptable,” said Biden spokesperson Karine Jean-Pierre, though it is perhaps notable she stopped short of tarring Mangione’s cheerleaders with the intensity of opprobrium she unforgettably used last fall to describe advocates of a cease-fire in Gaza. “In America, we do not kill people in cold blood to resolve policy differences or express a viewpoint,” Pennsylvania Gov. Josh Shapiro told attendees of a press conference touting Mangione’s arrest in his state, as though none of the tens of thousands of Americans who shoot people dead with guns each year have “viewpoints.” But only CNN pundit John Avlon, a right-wing think tank asset turned failed centrist Democratic congressional candidate, fell directly into what began to seem like a cleverly designed rhetorical trap laid by the young engineer: “If you’ve got a problem with the way insurance companies do business, there’s a lot of righteous ways to handle it, within the legal structure.”
Having thought about this quite a lot, I gotta say, I can’t think of a single one.
