Tennessee Medical Association Lawsuit Alleges Business Practices of Four MCOs Hurt Patient Care

The Tennessee Medical Association, which represents 6,600 physicians in the state, filed a lawsuit on April 25 against the state's four largest health plans for alleged "unfair and deceptive business practices that harm physicians" and patients, the Memphis Commercial Appeal reports (Barton, Memphis Commercial Appeal, 4/26). Filed in Davidson County Chancery Court, the suit names Aetna Inc., BlueCross BlueShield of Tennessee, United Healthcare Inc. and Cigna Healthcare of Tennessee -- which account for 70% of the state's HMO market -- as defendants (Park, Chattanooga Times Free Press, 4/26). The lawsuit seeks a court order to end several "wrongful and financially punitive" business practices that the health plans allegedly use to "delay, deny or reduce payments to physicians" (Gerome, AP/Nando Times, 4/26). The alleged practices include:

• Denying reimbursements to physicians for medically necessary care;
• "Downcoding," a practice in which health plans reimburse physicians for less expensive procedures than they performed;
• "Bundling," a practice in which health plans reimburse physicians for a single service when they have performed a number procedures;
• Using computer software to "automatically reduce or deny" reimbursements to physicians without reviews from health plan employees (Memphis Commercial Appeal, 4/26).