As Expected, Doctors, Aetna Settle Lawsuit
Aetna officials on May 22 confirmed that the company will pay $170 million to settle a class-action lawsuit in which approximately 700,000 physicians alleged that Aetna improperly denied and reduced reimbursements, Bloomberg/Philadelphia Inquirer reports (Snider, Bloomberg/Philadelphia Inquirer, 5/23). Aetna Chair Dr. John Rowe said that the company has agreed to pay $100 million to the physicians, $20 million to establish a foundation to improve the quality of health care and $50 million to cover the cost of the legal fees of the plaintiffs. The settlement also will provide an estimated additional $300 million to the physicians through improved automated systems that will eliminate some reimbursement reductions and expedite payments. Under the settlement, Aetna will establish an independent "Billing Dispute External Review Board" to resolve disputes with physicians (Kaiser Daily Health Policy Report, 5/22). The settlement also calls for Aetna to accept general treatment guidelines developed by the American Medical Association that require care decisions to be based on physicians' clinical judgment, rather that on the least expensive approach among scientifically accepted procedures, the New York Times reports (Treaster, New York Times, 5/23). Aetna does not admit wrongdoing in the settlement, which will involve about 18 medical societies and associations nationwide. The settlement is part a larger class-action lawsuit filed by physicians in U.S. District Court in Miami against several large health insurers. The lawsuit alleges that Aetna, UnitedHealthcare, Cigna, Coventry Health Care, WellPoint Health Networks, Humana Health Plan, PacifiCare Health Systems and Anthem Blue Cross Blue Shield delayed or denied reimbursements for health services and rejected claims for medically necessary treatments as part of a racketeering conspiracy (Kaiser Daily Health Policy Report, 5/22). The settlement requires approval from Federal District Judge Federico Moreno, who is presiding over the class-action suit (New York Times, 5/23). The class action will continue against the remaining insurers, the Miami Herald reports.
Reaction
Several physicians groups called the Aetna settlement a "historic action" that will allow doctors to spend more time with their patients and improve the likelihood that patients will receive coverage for treatments recommended by their physicians. AMA President-elect Donald Palmisano said, "The AMA expects this settlement to raise the bar for the entire health insurance industry." Aetna CEO John Rowe called the settlement "a sea change in relations ... that will lead to greater cooperation on critical aspects of quality, availability and affordability of care." Prudential Securities yesterday issued an analyst's opinion that the Aetna settlement could "lea[d] the way" for the other health plans in the class action to come to similar agreements because the settlement was "reasonably inexpensive" and could help Aetna in the future by improving relations with health providers and insurance purchasers (Dorschner, Miami Herald, 5/23). However, Kent Jarrell, a spokesperson for the remaining insurers in the class action, said, "Today's announcement of a settlement by Aetna does not alter the remaining companies' resolve to defend the case vigorously" (Yu, Dallas Morning News, 5/23). Bill McKeever, a UBS Warburg analyst, said it is "unnecessary" for the other insurers to settle "because the providers have a weak case. Aetna is just pulling a big PR stunt" (Singer, Fort Lauderdale Sun-Sentinel, 5/23).
BCBS Insurers Added to Class Action
In related news, a group of providers filed a lawsuit May 22 against Blue Cross Blue Shield insurance companies, making similar allegations to those made in the class-action lawsuit against insurers, the Hartford Courant reports. According to the 90-page complaint filed by Connecticut surgeon Kenneth Thomas, Florida oncologist Michael Kutell and the Connecticut State Medical Society, the BCBS insurers used automated computer programs to systematically deny or delay payments. The complaint also accuses BCBS insurers of racketeering for using their "economic power to force doctors into unfavorable contracts," the Courant reports. The suit seeks class-action status and was filed in the Miami court in which the other lawsuits against insurers have been consolidated (Gosselin, Hartford Courant, 5/23).
