Cigna Gives Preliminary Approval to Agreement To Settle Class-Action Lawsuit Over Physician Reimbursements
A federal judge in Missouri yesterday gave preliminary approval to an agreement settling a class-action lawsuit against Cigna over its use of software to reduce physicians' reimbursement claims. If given final approval, Cigna would likely pay physicians and other health care providers between $50 million and $65 million, significantly less than the estimated $200 million settlement expected under an earlier proposal, Modern Physician reports. Under the terms of the agreement, Cigna would admit to no wrongdoing and would not be required to stop using the claims-checking software. The company would, however, post on its Web site explanations of its claims coding and other payment policies and create an e-mail service to answer care providers' billing and coding questions. The agreement also requires Cigna to designate a third-party administrator to review previously denied claims and decide whether they should be paid. Attorneys representing nine medical societies in a separate class action suit in U.S. District Court in Miami said they would oppose the proposed agreement because it does not sufficiently change Cigna's claims processing practices (Page, Modern Physician, 11/26). Attorneys for the medical societies say the agreement would make it unnecessarily difficult for physicians to recoup payments (Martinez, Wall Street Journal, 11/27). No payments to physicians will be made until the agreement is finalized, which Cigna officials expect to take place by mid-2003 (Cigna release, 11/26). Any settlement is likely to have implications for other U.S. health insurers, most of whom face similar suits for their use of claims-checking software (Wall Street Journal, 11/27).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.