UnitedHealthcare sues Radiology Partners again, claiming mega practice ‘weaponized’ surprise billing protections
America’s largest commercial health insurer is suing the country’s biggest radiology group again over allegedly ill-gotten financial gains.
UnitedHealthcare first filed the complaint against Radiology Partners on Aug. 8 in an Arizona U.S. District Court. It claims the El Segundo, California-headquartered practice—which employs over 4,000 radiologists—has “weaponized” federal legislation meant to protect patients from surprise medical bills.
Signed into law in 2020, the No Surprises Act established an independent dispute-resolution process to settle payment disagreements between payers and providers. However, UnitedHealthcare charges Rad Partners has transformed such arbitration into a “vehicle to obtain a windfall for its private equity investors.” The allegations mirror those made by CVS-owned insurer Aetna, which also sued RP in December.
UHC previously took the radiology practice to court in 2023, claiming it had perpetrated a “pass through billing scheme” in its “unscrupulous pursuit of profits.” The suit ended in 2024 with neither side paying damages to the other after an arbitration panel quashed a $134 million judgment in favor of RP.
“Radiology Partners continues to exploit the No Surprises Act’s independent dispute resolution (IDR) process by submitting thousands of ineligible claims—claims that were never intended to qualify under the law,” UnitedHealthcare said in a statement sent to Radiology Business Thursday. “This pattern of bad behavior not only undermines the integrity of the IDR system but also drives up healthcare costs for everyone. We are committed to protecting our members and customers from harmful practices by a small number of private equity-backed providers.”
Radiology Partners, meanwhile, “firmly denies” the allegations, as it has done in the similar dispute with Aetna.
“This is yet another example of a broader and troubling trend: When payers lose in the federal No Surprises Act arbitration process, they turn to litigation,” a Rad Partners representative said in a statement shared with Radiology Business Thursday. “UHC’s complaint misrepresents the facts and distracts attention from its repeated failures to pay healthcare professionals despite federal protections.”
Rad Partners—which is backed by private equity firm Whistler Capital Partners and venture capital group New Enterprise Associates—said its practices always follow federal guidelines in the IDR process. They also have consistently prevailed in such payment disputes, Rad Partners emphasized, “underscoring the validity” of its IDR submissions.
“RP will vigorously defend against these claims and continue advocating for fair, lawful reimbursement practices that protect patients’ access to care,” it said in the statement. “We look forward to presenting the full facts in our formal court filing.”
More on the allegations
Minnetonka, Minnesota-based UnitedHealthcare claims Rad Partners’ alleged “scheme” started with the systematic acquisition of radiology practices across Arizona that were already in-network with the payer. Rather than honor the rates agreed to in these contracts, RP allegedly engineered a strategy to inflate reimbursements, the lawsuit charges. It did so by creating a “sham out-of-network entity,” Phoenix-based Sonoran Radiology, which had held no contract with UHC.
Rad Partners engaged in a “pass through billing scheme”—like the one alleged in the 2023 UHC lawsuit and Aetna’s complaint—funneling legitimate, in-network claims through Sonoran. This would make them appear out-of-network and eligible for higher payments.
“The groups that actually performed the services had already agreed to lower contracted rates, but by fraudulently billing the claims in this way, Radiology Partners sought (and received) inflated reimbursements,” the complaint claims.
UnitedHealthcare further alleges RP “escalated its scheme” beginning in 2022 by initiating the No Surprises Act independent dispute resolution process on these false, out-of-network claims. This would allow it to obtain “even greater payments, far in excess of what is reasonable and affordable.” Rad Partners has since submitted “tens of thousands” of claims the complaint charges. This is backed by recently released data from the federal government, which found RP is the No. 1 provider instigator of disputes, logging 136,784 in the second half of 2024.
Rad Partners accounts for over 90% of all IDR cases involving claims for professional radiology services, according to federal data cited in the complaint. This has resulted in RP and its affiliated practices regularly receiving payment awards at more than 600% of median in-network rates, UnitedHealthcare charges. More recently, the practice has allegedly began increasing Sonoran Radiology’s billed charges (and corresponding IDR offers) to reach nearly 1,600% of Medicare rates.
“The scope of defendants’ scheme is staggering. Radiology Partners, together with a handful of other private equity-backed provider groups, is responsible for ‘a large and disproportionate share of IDR cases’ nationwide,” the lawsuit charges. “This systematic abuse of the NSA IDR process is not only egregious but unprecedented, threatening the very integrity of the protections Congress intended to create,” it added later.
UnitedHealthcare is seeking compensation for the alleged actions at an amount to be determined via jury trial. It wants punitive damages, costs, attorney fees and prejudgment interest, among other demands. UHC is the largest health insurance company in the U.S. in terms of revenue ($215 billion) and market share (15.7%), covering approximately 50 million people, according to published estimates. The insurer and its parent company, UnitedHealth Group, have faced controversy in recent months. Most recently, reports have indicated the Department of Justice is investigating its Optum Rx business, on top of another investigation into alleged Medicare Advantage upcoding by UHC.
Marty Stempniak has covered healthcare since 2012, with his byline appearing in the American Hospital Association's member magazine, Modern Healthcare and McKnight's. Prior to that, he wrote about village government and local business for his hometown newspaper in Oak Park, Illinois. He won a Peter Lisagor and Gold EXCEL awards in 2017 for his coverage of the opioid epidemic.