Aetna To Pay $120M to Settle Suit

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Class action claims insurance giant underpaid out-of-network providers

" //#cheap_valium">aetnalogoNEW HAVEN — One of the plaintiffs in a high-profile court case that could affect how business is conducted in the health-care sector said it hopes a settlement, announced December 7, would result in “a framework based on transparency” regarding insurance claims.

The settlement requires Hartford-based health " /#there">there Aetna Inc. "//#adderall_no_prescription">adderall provide up to $120 million to patients and physicians who claimed in a class-action lawsuit that Aetna consistently underpaid out-of-network providers.

One of the plaintiffs in the suit was the Connecticut State Medical Society. Said Matthew C. Katz, executive vice president and CEO of the New Haven-headquartered society: “The financial settlement represents an important recognition of years of hard work by CSMS and other organizations on behalf of physicians and patients to correct artificially low payments by Aetna for out-of-network claims using the flawed Ingenix database.”

Katz added a caveat about future dealings with Aetna.

“However, CSMS will not rest until Aetna opens a new chapter in its relationships with physicians and patients — one with a framework based on transparency, communication and understanding.”

Codefendant Ingenix Inc. (rebranded in 2011 and now known as OptumInsight), a subsidiary of UnitedHealth Group, provided data used to determine what plaintiffs insisted were unfairly low out-of-network claim reimbursements.

The settlement agreement releases Aetna from admission of wrongdoing. The pact is subject to final court approval. Aetna is expected to pay roughly $60 million by that approval, and another $60 million by the end of a subsequent period during which claims are submitted and validated. In addition to payments to patient and physician plaintiffs, it is expected that a portion of the funds also will be applied to legal and administrative costs.

After taxes, Aetna expects to pay out $78 million. However, Aetna can negate the settlement if a threshold number of class-action participants decline the remedy. Also, final court approval is not expected until 2013.

In addition to CSMS, nine other state medical societies joined with the American Medical Association to file suit against Aetna on behalf of patients and physicians. The lawsuit was filed in 2007 in the U.S. District Court for New Jersey.

This does not end litigation regarding the matter for CSMS, which is involved in similar cases focusing on WellPoint and Cigna.

 

Felicia Hunter


 

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