An Ohio jury awarded Medical Mutual of Ohio over $50 million in damages on March 12 after the payer prevailed in its lawsuit against FrontPath Health Coalition and HealthScope Benefits, a subsidiary of UnitedHealthcare.
FrontPath offers employee benefits solutions, and HealthScope is a third-party administrator.
The two companies were accused of conspiring to form an enterprise that consisted of their executives and engaging in fraudulent practices that manipulated the bidding process for a health benefits contract with the city of Toledo in 2015 and 2018. Medical Mutual claimed that the two companies gained unauthorized access to its confidential financial data, which they then used to artificially lower bids, according to a March 14 news release from the company.
The defendants were found to have committed federal wire fraud, telecommunications fraud, tampered with records, and obstructed justice by submitting false bid information. The jury found that the conspiracy resulted in significant damages to Medical Mutual and ultimately caused taxpayers to pay higher healthcare costs than necessary.
The jury awarded Medical Mutual $23 million in compensatory damages, along with an additional $1.3 million in punitive damages. The court also granted $3.75 million for tortious interference with prospective business relations, as well as prejudgment interest and legal fees, increasing the total award to more than $50 million, according to Cleveland.com.
Medical Mutual has more than 1.2 million members across ACA, Medicare Advantage, and commercial employer plans.