Physicians Disagree on Class-Action Suit Settlement With Cigna
Physicians who filed a class-action lawsuit alleging unfair reimbursement practices against Cigna and seven other HMOs are divided over Cigna's expected offer today of a $540 million settlement, the Miami Herald reports (Dorschner, Miami Herald, 9/4). The preliminary settlement agreement is scheduled to be presented to Miami U.S. District Court Judge Federico Moreno. The suit, filed on behalf of up to 600,000 doctors, alleges that HMOs have engaged in a racketeering conspiracy by delaying or denying reimbursement for health services and by illegally rejecting claims for "necessary medical treatments." Under the settlement, there will likely be no limit on how many refiled claims will be paid to doctors who file them, and a third-party panel would review all renewed claims denied by Cigna. Refiled claims by retired doctors are anticipated to be capped at $30 million (California Healthline, 9/3). Cigna is also expected to establish a new $15 million foundation administered by state medical societies to deal with health-related issues important to doctors, the Fort Lauderdale Sun-Sentinel reports (Singer, Fort Lauderdale Sun-Sentinel, 9/4). The settlement amount includes cash payments for previously disputed claims, attorneys' fees and Cigna's investment in changing some of its reimbursement practices (Fuhrmans, Wall Street Journal, 9/4).
Dr. Timothy Kaiser, an Illinois surgeon who helped initiate the suit, wrote a letter to the court stating that he was "extremely offended" that the physicians' attorneys negotiated a $55 million package for themselves while doctors must refile claims before receiving reimbursements. "My interest in this was getting money to doctors," he said, adding, "Doctors did the work. Doctors were the ones that didn't get paid." However, Dr. Suzanne LeBel Corrigan, a Texas pediatrician and another original plaintiff, said she is "impressed with the final result," adding that the settlement offers "a very comprehensive approach" to resolving physician complaints. The settlement is supported by 20 state medical societies, and American Medical Association President Donald Palmisano praised Cigna for "agreeing to change its business practices and improve its relationships with practicing physicians and their patients." Harley Tropin, co-lead counsel for the physicians, said, "There will always be objectors and naysayers in any settlement. ... This settlement is a big step forward for the doctors and for Cigna" (Miami Herald, 9/4). Aetna reached a settlement agreement with the physicians in May (California Healthline, 5/30). The remaining insurers in the suit will continue to "vigorously fight the lawsuit," a spokesperson for the companies said (Miller, Atlanta Journal-Constitution, 9/4). The companies that have not settled are United Healthcare, Coventry Health Care, WellPoint, Humana Health Plan, PacifiCare Health Systems and Anthem BlueCross Blue Shield (American Health Line, 9/3).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.