Wellstar sues Kaiser, claiming underpayments and nonpayments totaling $41.7M

Wellstar Health System in Atlanta is suing Kaiser Permanente Insurance Co., and its Georgia affiliate, claiming they owe the health system more than $41.7 million, according to court documents.

In the lawsuit, filed Aug. 18 in the Superior Court of Gwinnett County, Wellstar claims Kaiser has refused to pay or underpaid Wellstar for services provided. Wellstar also alleges that Kaiser has not justified the non-payments or alleged underpayments. 

In particular, Wellstar claims Kaiser took an unauthorized 20 percent discount on goods and services Wellstar provided to Kaiser members from July 2017 to Dec. 31, 2020. 

Wellstar also claims Kaiser has paid zero dollars for the healthcare services the Georgia health system provided to Kaiser health plan members from Jan. 1 of this year through the date of the filed complaint. Wellstar says it is owed about $19 million to date from claims it properly submitted to Kaiser and the amount will continue to grow.

Wellstar claims in the lawsuit that it didn't authorize the discounts and wrote to Kaiser in November 2020, notifying the health plan that it improperly took the discounts and requested appropriate reimbursement. Wellstar claims Kaiser didn't respond to its letter. 

"By taking such unauthorized discounts, Kaiser underpaid Wellstar during this time period, and Wellstar is entitled to a judgment against Kaiser in an amount to be proven at trial for the unauthorized discounts," the lawsuit reads. 

Additionally, Wellstar said that Kaiser has not provided a letter or electronic notice stating the reasons for failing to pay the claims from Jan. 1 to the present.

"Kaiser’s failure to make payment or notify Wellstar about its reason for nonpayment within 15 days of receipt of such claims violates Georgia's Prompt Payment Statute," the lawsuit claims.

"Kaiser Permanente is committed to keeping healthcare affordable and paying fair and reasonable rates for emergency services provided to our members by non-Kaiser Permanente hospitals," Kaiser Permanente said in a statement to Becker's Hospital Review. "We look forward to a court reviewing Wellstar's claim for high charges, and are confident we will prevail following an impartial review of the facts."

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