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UnitedHealth Group, the health insurance giant, lost its cause Friday to prevent a former executive from working in the new health care company formed by three powerful companies, Amazon, Berkshire Hathaway and JPMorgan Chase.
A federal judge in Boston rejected United Health's request to have the executive, David William Smith, immediately stop working. Smith was an executive at Optum, a UnitedHealth unit, who accused him of concealing the company's secrets by claiming to be a competitor. Mr. Smith denied any wrongdoing.
In its files, UnitedHealth claimed that the role played by Mr. Smith at Optum had allowed him to know sensitive information about his projects. Optum's companies include one of the largest pharmacy benefit managers in the country, which mediates between drug manufacturers and employers who purchase drugs from their workers.
The industry has been strongly criticized for its lack of transparency on the way pharmacy benefit managers operate. Optum's two main competitors have recently merged with two major insurers, Aetna and Cigna.
Although Judge Mark L. Wolf ruled against it, Optum pointed out that the problems remained unresolved and had to be settled by arbitration. "We are committed to protecting our confidential information and will aggressively do so in arbitration," said Matt Stearns, spokesman for Optum, in a statement sent via email.
A spokeswoman for the new company, called "A.B.C." or "A.B.J." in court documents, declined to comment. Unlike court proceedings, arbitration sessions would not be public.
The legal wrangling, which included testimony not revealed by the judge earlier this week, also revealed new details about the powerful triumvirate's plans. Although the companies said the new company was not created to generate profits, they were extremely poorly informed about the changes they could make to reduce costs and improve the quality of care provided to their employees. The company made headlines last summer by choosing General Manager Dr. Atul Gawande, a renowned doctor who writes for the New Yorker.
The court proceedings also showed how dissatisfied customers were, especially those three employers, with the status quo.
"We have been asked to solve a very big problem, which is to find new methods of health care," said John C. Stoddard, senior executive of the new company.
The three employers combined spend about $ 4 billion a year for the one million people they cover. But the employees "have a bad experience," said Stoddard.
"They do not get the care they need and the costs continue to increase," he said. "We would not exist without the need to find and find a new solution to the problem."
The company, which has no name and fewer than 20 employees, plans to tackle several areas, including how traditional health insurance plans provide benefits, Stoddard said. High deductibles, which force employees to pay large amounts of their care before insurance takes effect, are a challenge for "workers in distribution centers and call centers", a- he declared.
Companies also want to see if they can reduce the cost of drugs for chronic diseases. In his testimony, Mr. Stoddard emphasized that the new company did not plan to enter the pharmacy sector but wanted to better understand the process and the actual cost of drugs.
"It does not make us a competitor," he said. "It makes us a very informed customer."
Employers also want to help workers see a doctor, Stoddard said. As Optum also operates an extensive network of primary care physicians, the company may wish to collaborate with Optum to provide employees with easier access to physicians.
"That's why it's so crazy for me: they see us as competitors, when I see ourselves as potential partners," said Stoddard.
Like other large employers, companies also want to know if they can better use data from doctors and hospitals and determine where employees can get better care at lower prices.
The company plans to conduct a series of experiments to test new approaches for smaller groups of employees with various partners, including Optum, Stoddard said.
But if Mr. Stoddard did not rule out the possibility that the company was a competitor, he emphasized that his goal was different. Unlike Optum, which he described as trying to "maximize profits," the new organization "is trying to create value for families trying to use the health system," he said. he declares.
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