Calif. Attorney General To Investigate HMOs’ Alleged Claims Denials
Last week, California Attorney General Jerry Brown (D) said his office will examine how the state's HMOs review and pay medical claims, the Los Angeles Times reports.
The announcement comes after the California Nurses Association labor union released a report suggesting that California's largest HMOs rejected about one-fifth of all medical claims filed during the past seven years (Girion, Los Angeles Times, 9/4).
Brown said that the state will investigate the HMOs because the high claims denial rate suggests that the system is dysfunctional (AP/Santa Cruz Sentinel, 9/3).
CNA Report Details
For the study, CNA collected data from financial reports on the state Department of Managed Health Care's Web site (Calvan, Sacramento Bee, 9/3).
Investigators found that between 2002 and June 2009, the state's six largest insurers rejected about 45.7 million medical claims, or 22% of all claims filed (Los Angeles Times, 9/4).
The report also notes that during the first half of 2009:
- Aetna denied 6.5% of claims;
- Anthem Blue Cross denied 28% of claims;
- Kaiser Permanente denied 28% of claims;
- Health Net denied 30% of claims
- CIGNA denied 32.7% of claims; and
- PacifiCare denied 39.6% of claims (Colliver, San Francisco Chronicle, 9/4).
The report does not include data on Blue Shield of California, which does not submit claims rejection information to DMHC (Los Angeles Times, 9/4).
The California Association of Health Plans, which represents the insurance companies, questioned the validity of CNA's findings (United Press International, 9/3).
Insurers said claims rejections do not always reflect actual treatment denials (Los Angeles Times, 9/4). They said that health plans sometimes reject medical claims when:
- Administrators file claims with the wrong insurance company;
- Health care providers seek reimbursement for experimental procedures; and
- Patients seek services from out-of-network physicians (Sacramento Bee, 9/3).