Cuomo Setting Up Revolutionary Health Care Database

October 27, 2009 Updated: October 27, 2009

NEW YORK—Increasing health care quality and reducing its cost through competition in a free market is a concept that both Democrats and Republicans have embraced. Now New York Attorney General Anthony Cuomo is making competitive shopping easier for health care consumers to engage in.

On Tuesday, Cuomo announced the planned creation of a new database that will, for the first time, allow patients around the country to find out in advance how much they are likely to be reimbursed for out-of-network health care services in their area—no small feat in the complicated world of health care.

The database and new nonprofit company running it “will bring much-needed transparency, accountability and fairness to a broken consumer reimbursement system,” said Cuomo, according to a release.

The project is being funded by $100 million in settlement proceeds that Cuomo helped secure through suing insurance companies.

“This is an important step forward for consumers, who too often are unable to penetrate the secrecy and bureaucracy of insurance companies,” said Nancy Ann DeParle, director of the White House Office of Health Reform, in a statement.

The creation of the database is the culmination of Attorney General Cuomo’s nationwide investigation into the Ingenix database, which he concluded was "defective and conflict-ridden."

Ingenix, a subsidiary of UnitedHealth, was used by insurers nationwide to set reimbursement rates when patients went out of network for health services.

The attorney general’s investigation found that as a subsidiary of the second-largest insurer in the nation, Ingenix had a vested interest in helping set rates low, so companies could underpay patients for out-of-network services.

The new database is set to be headquartered at Syracuse University, and run by a research network that includes researchers from the State University of New York (“SUNY”) in Buffalo, Cornell University, University of Rochester, and SUNY Upstate Medical University.

“Everyone agrees that to fix our health care system, we need accurate data on what health care services actually cost and how they are priced,” said Stephen A. Warnke, chairman of the nonprofit being set up, FAIR Health.