Maybe the DOJ Will Be Tougher on Health Insurers Than Wall Street Thought

A new motion by the DOJ could reshape how health insurers do business — and how much control they have over what doctors get paid.

In a significant move, the DOJ filed a “statement of interest” in federal court this week, siding with hundreds of physicians who accuse top insurers and a firm formerly known as MultiPlan — now rebranded as Claritev — of conspiring to fix prices for out-of-network care.

The DOJ’s involvement doesn't just add legal firepower. It sends a signal that this case matters. More importantly, it casts a harsh spotlight on how major insurers including UnitedHealthcare, Aetna, Cigna and Elevance may have skirted antitrust laws through a so-called “third-party intermediary” — and whether Wall Street has been too confident in the impunity these corporations usually enjoy.

According to reports, the DOJ rebuffed Claritev’s argument that there was no price-fixing conspiracy simply because insurers may use the company's algorithm differently. The Sherman Antitrust Act, the DOJ pointed out, is clear: even setting a “starting point” for prices — if done in coordination — can be anti-competitive. And sharing sensitive pricing data through a middleman? That’s also potentially illegal.

As someone who spent years inside the health insurance industry, I can tell you that what’s at stake here is nothing short of enormous. If this lawsuit proceeds, we might finally get a clearer picture of how these corporations — working together under the cover of a “neutral” analytics firm — manipulated payment rates to increase profits, all while starving frontline health care providers.

Claritev and its insurer partners, of course, deny the allegations and have moved to dismiss the case. But the DOJ’s filing now stands in their way.

Some history

The backstory adds even more weight to the DOJ’s action. In 2023, a New York Times investigation uncovered how Claritev (then MultiPlan) operated under a perverse incentive: the more it “saved” insurers and their corporate clients by underpaying doctors, the bigger the cut Claritev and insurers took for themselves. That same year, Senator Amy Klobuchar called on federal regulators to investigate what she and many providers viewed as algorithm-enabled price-fixing. She even introduced legislation to stop corporations from using AI tools to coordinate pricing.

The DOJ statement of interest comes just weeks after the agency launched an investigation into UnitedHealth Group’s Medicare billing practices. As the Wall Street Journal reported, the DOJ “is examining the company’s practices for recording diagnoses that trigger extra payments to its Medicare Advantage plans, including at physician groups the insurance giant owns.”

For years, insurers have been able to hide behind complex data systems, AI algorithms and opaque contracting practices to squeeze providers — and boost profits. Investors have generally assumed that neither Congress nor federal regulators would seriously challenge that model.

But this latest move by the DOJ suggests otherwise. Maybe — just maybe — the Trump Administration will be tougher on insurers than investors expected. And if that is true, it would be a long-overdue course correction – for doctors, patients and taxpayers.