Medical Societies Oppose Cigna’s Settlement of Physician Class-Action Lawsuit in Illinois

Medical societies from several states and counties yesterday voiced opposition to a proposed settlement health insurer Cigna reached in Illinois federal court last month, saying that the settlement may eventually "let the entire managed care industry off the hook for critical reforms," the Chicago Tribune reports (Japsen, Chicago Tribune, 12/11). In the Illinois suit, physicians alleged that Cigna used a program called ClaimCheck to screen their claims for combinations of procedures and then eliminated or reduced payments for some of them, thus paying less than what the doctors billed. Cigna said the software helps eliminate unnecessary, erroneous or fraudulent claims, but doctors said the system "unfairly deprives them of legitimate fees." Under the settlement, Cigna will pay back claims to 600,000 to 700,000 physicians and other health care providers. In addition, the insurer will post explanations of its payment policies and claim coding system on its Web site and will appoint a third-party administrator to review claims that have been denied since Jan. 1, 1996 (California Healthline, 11/27). The societies, gathering this week at the American Medical Association House of Delegates meeting, expressed concern that the settlement could "derail" a class-action lawsuit in Florida against almost every managed care company, including Cigna, the Tribune reports. The medical associations say that the Cigna settlement could factor into the judge's decision on whether to exempt the insurer from liability in the larger Florida case. In addition, some physicians say that the Illinois settlement "doesn't go far enough" and "doesn't guarantee" that Cigna will change its business practices, according to the Tribune.

Jack Lewin, CEO of the California Medical Association, said, "The Cigna case allows health plans to go back to old behaviors and provides no mean to resolve disputes between doctors and their health plans" (Chicago Tribune, 12/11). Dr. Donald Timmerman, president of the Connecticut State Medical Society, called the Illinois settlement "a giant step backward," the AP/Nando Times reports (Bergstrom, AP/Nando Times, 12/10). However, some physicians and attorneys say that the settlement is a "positive first step" in changing managed care practices, according to the Tribune. "Doctors have never seen anything like this before," Jodi Wilson, an Illinois attorney representing physicians in the Cigna case, said, adding, "Doctors now know what claims to submit and when to submit them to get paid" (Chicago Tribune, 12/11).