DMHC Issues Fines Against Several Health Care Organizations

The California Department of Managed Health Care has levied fines against three health care organizations and reached a settlement with another, Payers & Providers reports.

Emergency Services Medical Corporation Settlement

DMHC has reached a settlement with Emergency Services Medical Corporation over the balance billing of 324 patients after the state Supreme Court in 2009 ruled the practice illegal (Shinkman, Payers & Providers, 3/25).

Balance billing refers to out-of-network providers charging patients for the difference between what patients' insurers cover and what providers' charge for the service (California Healthline, 2/18).

Under the agreement, ESMC -- which provides emergency services to Sharp Healthcare in San Diego -- agreed to:

• Cease the practice of balance billing;
• File a plan of correction; and
• Obtain a new agent to conduct its billing practices.

No fine was assessed, but ESMC will refund patients about $24,711.

Aetna Fine

Meanwhile, DMHC levied a $30,000 fine against Aetna for failing to take proper actions in a case to determine whether a patient's care was medically necessary before denying payment.

In 2013, an Aetna plan enrollee sought care from an emergency care center that was included in the insurer's network. However, Aetna denied payment, and the patient was charged a $150 copayment, rather than the typical $50 copayment under the plan contract.

Aetna deemed the care medically unnecessary when the patient filed a grievance. In doing so, DMHC found that the insurer violated the Knox-Keene Act.

Dental Choice of California

DMHC levied a separate $30,000 fine against Dental Choice of California for an unfair pattern of provider payments.

Specifically, DMHC determined that the dental plan failed to:

• Pay full interest on claims;
• Provide clear determination letters for disputed claims; and
• Adequately report disputes to DMHC.

Human Affairs International of California

DMHC also fined Human Affairs International of California $15,000 for a separate unfair practice case.

DMHC determined that the organization, a subsidiary of Magellen Health Services, did not pay the necessary amount of its claims in a timely manner. Specifically, HAIC paid 94% of its claims in a timely manner -- below the 95% threshold (Payers & Providers, 3/25).