New York Reaches Settlement With HMOs Over Explaining Care Decisions

Six HMOs operating in New York -- Aetna/U.S. Health Care, Prudential Health Plan, Group Health Incorporated, HIP Health Plans, Vytra Health Plans, Oxford Health Plans and Excellus Health Plans -- have reached a settlement with the state attorney general's office regarding how denials of care and treatment are handled, the Albany Times Union reports. While the insurers did not admit to any "wrongdoing," they agreed to pay $1 million to cover the state's investigation into the practices and to adopt "more patient-friendly policies" (Jochnowitz, Albany Times Union, 10/17). A two-year investigation found that many claim denials were "so vague or perfunctory" that patients "could not fashion an effective appeal" (Rau, Newsday, 10/17). The investigation found that HMOs denied care for anxiety, depression, substance abuse and hospitals stays while offering "minimal information" for the decisions. The investigation also "raised questions" on how insurers documented "physician involvement" in the claims review process, though uncovered "no evidence" that business workers were making the decisions. The Times Union reports that the "major change" to come from the settlement is a new policy that will require insurers to provide patients with "specific medical findings" on why care was denied. These notices will also be made available to hospitals and doctors, who may appeal a decision (Albany Times Union, 10/17). While Spitzer said the settlement was a "landmark" agreement, the New York Health Plan Association said the investigation addressed "technical issues only" and did not find evidence that patients were "inappropriately denied medical care." Paul Macielak, president and CEO of the group, said, "In essence, this reaffirms existing practice, as plans are currently providing this information to members, as required by New York's External Appeal Law"(Newsday, 10/17). For further information on state health policy in New York, visit State Health Facts Online.