by David Armstrong, Patrick Rucker and Maya Miller
Originally published on Feb. 2, 2023 on Pro Publica. Excerpt reprinted with permission.

Note from the Editor: What is wrong with this picture?
• On one hand health plans are reporting record profits but on the other hand hospitals are closing.
• On one hand 7 health insurance CEOs raked in a record $283 million last year but on the other hand emergency physician reimbursement is headed for a record decline in 2023.
• On one hand medical billing can run $2 million a year yet on the other hand a level 5 emergency physician fee is around $500. Emergency doctors, not hospitals are targeted for non-payment by health plans. Is it time for us to revolt.

In May 2021, a nurse at UnitedHealthcare called a colleague to share some welcome news about a problem the two had been grappling with for weeks. 

United provided the health insurance plan for students at Penn State University. It was a large and potentially lucrative account: lots of young, healthy students paying premiums in, not too many huge medical reimbursements going out. 

But one student was costing United a lot of money. Christopher McNaughton suffered from a crippling case of ulcerative colitis — an ailment that caused him to develop severe arthritis, debilitating diarrhea, numbing fatigue and life-threatening blood clots. His medical bills were running nearly $2 million a year. 

United had flagged McNaughton’s case as a “high dollar account,” and the company was reviewing whether it needed to keep paying for the expensive cocktail of drugs crafted by a Mayo Clinic specialist that had brought McNaughton’s disease under control after he’d been through years of misery. 

On the 2021 phone call, which was recorded by the company, nurse Victoria Kavanaugh told her colleague that a doctor contracted by United to review the case had concluded that McNaughton’s treatment was “not medically necessary.” Her colleague, Dave Opperman, reacted to the news with a long laugh. 

“I knew that was coming,” said Opperman, who heads up a United subsidiary that brokered the health insurance contract between United and Penn State. “I did too,” Kavanaugh replied. 

Opperman then complained about McNaughton’s mother, whom he referred to as “this woman,” for “screaming and yelling” and “throwing tantrums” during calls with United. 

The pair agreed that any appeal of the United doctor’s denial of the treatment would be a waste of the family’s time and money. 

“We’re still gonna say no,” Opperman said. 

More than 200 million Americans are covered by private health insurance. But data from state and federal regulators shows that insurers reject about 1 in 7 claims for treatment. Many people, faced with fighting insurance companies, simply give up: One study found that Americans file formal appeals on only 0.1% of claims denied by insurers under the Affordable Care Act. 

Insurers have wide discretion in crafting what is covered by their policies, beyond some basic services mandated by federal and state law. They often deny claims for services that they deem not “medically necessary.” 

When United refused to pay for McNaughton’s treatment for that reason, his family did something unusual. They fought back with a lawsuit, which uncovered a trove of materials, including internal emails and tape- recorded exchanges among company employees. Those records offer an extraordinary behind-the-scenes look at how one of America’s leading health care insurers relentlessly fought to reduce spending on care, even as its profits rose to record levels. 

As United reviewed McNaughton’s treatment, he and his family were often in the dark about what was happening or their rights. Meanwhile, United employees misrepresented critical findings and ignored warnings from doctors about the risks of altering McNaughton’s drug plan. 

At one point, court records show, United inaccurately reported to Penn State and the family that McNaughton’s doctor had agreed to lower the doses of his medication. Another time, a doctor paid by United concluded that denying payments for McNaughton’s treatment could put his health at risk, but the company buried his report and did not consider its findings. The insurer did, however, consider a report submitted by a company doctor who rubber-stamped the recommendation of a United nurse to reject paying for the treatment. 

United declined to answer specific questions about the case, even after McNaughton signed a release provided by the insurer to allow it to discuss details of his interactions with the company. United noted that it ultimately paid for all of McNaughton’s treatments. In a written response, United spokesperson Maria Gordon Shydlo wrote that the company’s guiding concern was McNaughton’s well-being. 

“Mr. McNaughton’s treatment involves medication dosages that far exceed FDA guidelines,” the statement said. “In cases like this, we review treatment plans based on current clinical guidelines to help ensure patient safety.” 

But the records reviewed by ProPublica show that United had another, equally urgent goal in dealing with McNaughton. In emails, officials calculated what McNaughton was costing them to keep his crippling disease at bay and how much they would save if they forced him to undergo a cheaper treatment that had already failed him. As the family pressed the company to back down, first through Penn State and then through a lawsuit, the United officials handling the case bristled. 

“This is just unbelievable,” Kavanaugh said of McNaughton’s family in one call to discuss his case. ”They’re just really pushing the envelope, and I’m surprised, like I don’t even know what to say.” 

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