SSM Health sued Bright Health Group for alleged failure to pay claims for care provided at its Oklahoma facilities. Claims could herald similar efforts by more health systems to collect reimbursements from financially struggling startup insurers.
Ari Gottlieb, principal at consulting firm A2 Strategy Group, pointed to the possibility of unpaid claims in other states where Bright Health operates.
“I think there will be more lawsuits like this,” Gottlieb said. “It’s a big deal.”
SSM Health’s Oklahoma division is headquartered in St. Louis filed a complaint April 10 against Bright Health, which allegedly owes SSM nearly $13.1 million for services provided to its members from January 1. 2020 through February 7, 2023. Bright Health exits the Oklahoma market, among more than a dozen other states, at the end of 2022 as the market loses money and faces regulatory scrutiny.
Bright Health offers coverage to Oklahoma residents through the Affordable Care Act health insurance exchange marketplace and does not have a written contract with SSM for a discount from the health system, single lawsuit filed in federal court in Oklahoma said. As a result, Bright Health must pay “reasonable and customary fees billed by the SSM” in connection with the nearly 2,500 claims, the health system argued.
SSM declined to comment and Bright Health did not immediately respond to a request for an interview.
This appears to be the first time a health system has sued Bright Health in federal court over unpaid claims, according to Modern Healthcare’s analysis of court records.
Like Bright Health’s previous exchanges in 14 other states, the company ended coverage for about 14,000 Oklahoma members earlier in the year. Company executives said during an earnings call last month they were working with state regulators to clear outstanding debts to suppliers. The Oklahoma Department of Insurance declined to comment.
The lawsuit says Bright Health also allegedly failed to pay a state regulatory $2.1 million risk adjustment for 2021.
“The fact that they didn’t do it is amazing,” Gottlieb said. If that’s the case, Bright Health’s financial situation is even worse than expected, he said.
“Is Bright not making risk-adjusted payments in other states?” he say.
Bright Health reported a shortfall of $12.9 million among its state-managed subsidiaries late last year. Several states have placed Bright Health under scrutiny that requires approval to spend money, including for requests that exceed a certain threshold.
The insurer also faces legal troubles in other jurisdictions.
The company and its executives were sued in a Minnesota court this month by the founders of Zipnosis, a telehealth provider that Bright acquired for no money. disclosed in 2021. Ben Bowman and Jon Pearce allege Bright Health executives misled them by withholding information about the business ahead of its initial public offering, prompting Bowman and Pearce agreed to accept shares of the startup in exchange for ownership of a telehealth provider.
The company also faces two ongoing lawsuits from shareholders in Delaware and New York that allege the company misled investors about its operations before going public.
