{ "docId": "019dd923-622c-750b-8b97-1ab4276c66b3", "docSlug": "cc2ab32a5b10", "documentTitle": "MultiPlan Corp (MPLN)", "authorId": "51_Muddy_Waters", "authorName": "Carson C. Block", "documentKindSlug": "research-note", "documentKindLabel": "Research note", "sourceTypeSlug": "short_seller", "sourceTypeLabel": "Short seller", "presentationDate": "2020-11-11 00:00:00", "orientation": "portrait", "aspectRatio": 0.77272725, "pageNumber": 8, "pageCount": 14, "prevPage": 7, "nextPage": 9, "slideType": "expose_contradiction", "function": "expose_contradiction", "density": "overcrowded", "nDataPoints": 0, "notes": "This slide functions as a short-seller research note, systematically dismantling the company's narrative of being a 'preferred partner' and 'cost-cutting savior'.", "elementsJson": [ "paragraph", "footnote" ], "metadataConfidence": 1, "imagePath": null, "slideHref": "/slides/019dd923-622c-750b-8b97-1ab4276c66b3/8", "deckHref": "/decks/019dd923-622c-750b-8b97-1ab4276c66b3", "deckJsonHref": "/decks/019dd923-622c-750b-8b97-1ab4276c66b3.json", "deckAnchorHref": "/decks/019dd923-622c-750b-8b97-1ab4276c66b3#slide-8", "components": [ { "bbox": null, "kind": "callout", "text": "The price cuts suggest that MPLN is not at all a preferred partner, but one of several near-identical vendors that is a price taker.", "attrs": null, "subkind": null, "toolName": "Visual emphasis", "toolSlug": "visual-emphasis", "confidence": null, "componentId": "019dd953-3f3c-7011-a9a3-f488368f8af3", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.115, "w": 0.764, "x": 0.118, "y": 0.418 }, "kind": "paragraph", "text": "We understand that MPLN has had its take squeezed repeatedly by major insurers in recent years, with the take rate falling by half in some cases. Yet MPLN has not acknowledged this trend. MPLN holds itself out to investors as a “preferred partner” of major insurers, stating that it is “deeply integrated and embedded with all four” top United States insurance plans. The price cuts suggest that MPLN is not at all a preferred partner, but one of several near-identical vendors that is a price taker.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "2effb42f-f40b-4dd8-a3ea-ec05dd1b1d60", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.105, "w": 0.764, "x": 0.118, "y": 0.668 }, "kind": "paragraph", "text": "To add insult to injury, one former MPLN executive stated that any exclusivity clauses in its contracts with insurers are virtually unenforceable. Carriers apparently control the flow of claims and are not required to offer any transparency to vendors. This means that MPLN’s payor customers, most of whom are much larger than the company, can shift claims away from MPLN with no warning. Such tenuous economic relationships seemingly contradict MPLN’s “key strategic partner” line.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "3815231f-e9eb-4cb6-b518-ec3146150dae", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.055, "w": 0.764, "x": 0.118, "y": 0.093 }, "kind": "paragraph", "text": "vendors get paid on the spread between the billed and resolved amounts, as this incentivizes exorbitant provider and facility billing in the first place. As we noted above, it is these excessive fees that UHC is seeking to bring down with Naviguard.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "3b374c2e-14c0-43a0-a9fe-71054fbf6e53", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.115, "w": 0.764, "x": 0.118, "y": 0.543 }, "kind": "paragraph", "text": "We also believe that MPLN misleadingly touts proprietary data and deep customer relationships in an attempt to paint itself as a cost-cutting savior, rather than a commoditized tool reliant on billings bloat to grow sales. The claims repricing database and bill negotiation services offered by Data iSight are replicated by out-of-network claims pricing competitors like Zelis, and our conversations with industry professionals indicated that there is little difference between one pricing database and the other major players on the market.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "4345b2db-23fb-4b23-9253-d1401a3cb9f1", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.125, "w": 0.764, "x": 0.118, "y": 0.158 }, "kind": "paragraph", "text": "While MPLN secures a lower bill for employers, it often offers few balance billing protections for the member. If a member gets balance billed, he is required to pay the exorbitant remaining amount. After MPLN reprices the claim, the member can be left with an even higher bill than he had before MPLN got involved. This fraught situation frequently returns to the employer’s doorstep, as the member tries to figure out how to pay the bill. In many cases, employers eat the balance bill, defeating the purpose of using MPLN in the first place.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "69e8c9bb-12d7-4b69-82d4-c4b62e53cea8", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.115, "w": 0.764, "x": 0.118, "y": 0.293 }, "kind": "paragraph", "text": "Two former MPLN executives described to us that MPLN, in its efforts to acquire new business, promised minimal balance billing “noise” in discussions with health insurers. They told us that balance billing of MPLN members has grown significantly in recent years, and employers have become increasingly dissatisfied with the product. Per our conversations, poor customer satisfaction is why MPLN has been subject to repeated, price cuts from major insurers. This apparent fact that remains undisclosed by the company.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "b58c857a-bd85-4098-ad81-d5a11f9b3d5c", "frameworkName": null, "frameworkSlug": null }, { "bbox": null, "kind": "quote", "text": "MPLN holds itself out to investors as a “preferred partner” of major insurers, stating that it is “deeply integrated and embedded with all four” top United States insurance plans. — MPLN Analyst Day Presentation, p. 24", "attrs": null, "subkind": null, "toolName": "Authority citation", "toolSlug": "authority-citation", "confidence": null, "componentId": "019dd953-3f3c-7011-a9a3-fa9d530263b5", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.04, "w": 0.35, "x": 0.118, "y": 0.88 }, "kind": "source-note", "text": "15 MPLN Analyst Day Presentation, p. 24\n16 MPLN Analyst Day Presentation, p. 17", "attrs": null, "subkind": null, "toolName": null, "toolSlug": null, "confidence": null, "componentId": "a0b28767-e8e5-4ab2-b298-444ff31f7572", "frameworkName": null, "frameworkSlug": null } ], "metrics": [], "tools": [], "frameworks": [], "arcBeats": [], "loops": [], "imagePathAlt": null, "thumbSrc": null, "thumbSrcAlt": null, "locked": true }