Tacoma health system says it lost $1.2M after billing vendor ‘dropped the ball’
AI-generated summary reviewed by our newsroom.
- MultiCare sues over losses from reported billing issues; case moved to federal court.
- Complaint: ~$1.6M not timely submitted; $1.2M remained unrecoverable after wind‑down.
- After breach notice and 90‑day wind‑down, MultiCare seeks $1.2M plus interest and fees.
A Tacoma health system blames a vendor for missed billing and reimbursement, costing the health system more than a $1 million.
Tacoma-based MultiCare Health System filed a lawsuit at the end of December in King County Superior Court against Optum Inc. and Change Healthcare Technology Enabled Services LLC.
Late last month, the lawsuit was removed to U.S. District Court Western District of Washington.
In a complaint, MultiCare’s attorneys say the health system contracted for billing and reimbursement services with Change, now owned by Optum, in July 2022.
According to the lawsuit, “Change repeatedly dropped the ball.”
Attorneys for Optum and Change, in their notice of case removal to federal court, stated in a filing, “Defendants do not admit any of the allegations in MultiCare’s complaint, and do not concede that MultiCare is entitled to any relief.”
Neither an attorney for MultiCare nor attorneys for Optum/Change offered further comment on the case when contacted by The News Tribune.
How billing events escalated into legal action
In its work, Change was to serve as “an intermediary between MultiCare and its patients’ insurers and other payors,” according to the case complaint. MultiCare gave billing information to Change, which would work with insurers “to secure reimbursement for MultiCare’s services.”
Change would take a percentage of payors’ reimbursements for its services. By 2023, MultiCare confronted Change over “persistent issues” regarding timeliness and accuracy of its billing services, according to the complaint.
The lawsuit contends that by early 2024, “Change had failed to timely submit or process approximately $1.6 million in claims, half of which had passed their required claim-submission windows and could no longer be recovered.”
MultiCare eventually submitted a formal notice of breach of contract on Aug. 22, 2024.
“Following a 90-day wind-down period, at least $1.2 million in claims remained outstanding, and MultiCare was left with no ability to recover this money or mitigate its losses,” the complaint stated.
MultiCare seeks to recover the $1.2 million, plus pre- and post-judgment interest as well as its legal costs and attorneys’ fees and expenses.
