Frier Levitt Files The First Healthcare Shared Savings Litigation In The Northeast – Providers In Shared Savings Agreements Should Take Heed

On December 23, 2021, Frier Levitt filed suit on behalf of Osler Health IPA, LLC (“Osler”) against Horizon Healthcare Services, Inc. d/b/a Horizon (“Horizon”), for allegedly materially breaching the Parties’ shared savings agreement. The Complaint alleges, among other things, that Horizon failed to adhere to its data and data analytics transparency obligations under the contract, in addition to breaching a settlement agreement arising out of an earlier shared savings dispute (that went unlitigated). This case appears to be the first of its kind in the Northeast region of the U.S.

Osler, an Independent Physicians Association (“IPA”) comprised of 23 independent primary care practices, has been a party to a commercial shared savings agreement with Horizon for years, but has rarely been paid what, per the Complaint’s allegations, it has earned in  savings – a potential value of several million dollars. This resulted from, among other things, Horizon’s chronic failure to timely and consistently provide Osler with the healthcare data and data analytics required under the contract. These data and analytics were necessary for Osler to perform its core functions as a value-based care-centered entity in terms of reducing its constituent practices’ costs and utilization metrics while maintaining the highest quality of care. Not only did this frustrate Osler’s ability to optimally earn shared savings, but it also rendered Horizon’s shared savings determinations suspect and effectively unverifiable. As further alleged, Osler made every effort to resolve these issues with Horizon outside of the court system. Unfortunately, in lieu of fairly addressing Osler’s reasonable complaints, Horizon took the retaliatory step of refusing to enter into any future value-based care contracts with the IPA. Osler’s Complaint followed thereafter.

The power dynamic between providers and carriers in shared savings arrangements is, more often than not, weighted heavily against providers. As gatekeepers of the healthcare data and data analytics at the heart of any shared savings model, carriers can, in the absence of legal protections, pre-determine the outcome of these and other value-based care payment contracts to their benefit and the providers’ detriment.

It’s time for providers to level the playing field. Step one is retaining competent healthcare counsel familiar with value-based care contracting and with experience litigating in this rapidly-expanding space. If you wish to discuss your options, contact Frier Levitt for a consultation.