New York physician blames insurance company, health center for bankruptcy

A Rockland, N.Y.-based physician has blamed his bankruptcy on Fidelis Care health insurance and Spring Valley, N.Y.-based Refuah Health Center, Westchester & Fairfield County Business Journals reported June 7. 

Pediatrician and practice owner Seth Kurtz, MD, said the two companies have made "concerted action" to block reimbursements to his practice, according to an affidavit filed in U.S. Bankruptcy Court cited in the Business Journals. Fidelis and Refuah did not respond to emails from the publication requesting a comment on the allegations.

QHC Upstate Medical filed for Chapter 11 reorganization on July 5, declaring $366,049 in assets and $2,289,588 in liabilities. The practice previously sued Fidelis for $3 million for allegedly illegally canceling its service agreement. A Rockland County Supreme Court judge ruled against the practice and awarded $1.5 million to Fidelis last year, a decision Dr. Kurtz has appealed. 

In 2020, the practice grossed more than $9 million, according to a bankruptcy schedule cited by the publication, and revenues nearly doubled last year. 

After having a health service agreement with the practice that was renewed yearly since 2011, Fidelis sent QHC an audit letter demanding $1.9 million for nearly five years of alleged improper billings in 2019. The payer then declared the service agreement would not be renewed. 

According to Dr. Kurtz, Fidelis did not respond to a request for documents to support the alleged $1.9 million in improper billings, and the loss of coverage forced the practice to halt operation. 

The audit letter was part of a "coordinated, retributive and retaliatory illegal act initiated by Refuah Health Center Inc.," Dr. Kurtz alleged in his affidavit.

"It became increasingly apparent that Fidelis’ ultimate goal was not to work with the debtor (QHC) anymore in Rockland County," Dr. Kurtz said, according to the Business Journals, "unless the terms and conditions of our relationship were substantially modified."


 QHC is considering whether to pursue litigation, Dr. Kurtz said.

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