| Alleging top HMOs play a "game of cat and mouse" with doctors and their patients, the Medical Society of New Jersey (MSNJ) is suing Aetna U.S. HealthCare, AmeriHealth HMO of New Jersey, CIGNA HealthCare, Health Net, and Oxford Health Plans for using deceptive business practices that "deliberately delay, deny, and impede" payment to the 8,000 New Jersey physicians who have contracts with them.
| "Faceless insurance company bureaucrats and clerks make critical care decisions that favor the HMO bottom line rather than sound medical judgment." |
The lawsuits were filed May 9, 2002, in the Chancery Court in Mercer County by local attorneys and legal giant Milberg, Weiss, Bershad, Hynes & Lerach. They make MSNJ the fifth state medical society to take nearly identical legal action against HMOs in their respective state courts, following Connecticut, New York, South Carolina, and Tennessee.
"Faceless insurance company bureaucrats and clerks make critical care decisions that favor the HMO bottom line rather than sound medical judgment," says Dr. Robert S. Rigolosi, MSNJ president. "That is not what patients paid for in their insurance premiums. And it certainly is not what they deserve."
The lawsuits, which seek class action status, say these unfair business practices include:
- Failing to pay claims on time. MSNJ conducted a physician survey last year that found 21 percent of properly submitted electronic claims were not paid within the state-mandated 30-day period, and that 31 percent of properly submitted paper claims were not paid within the 40-day period required by state law.
- Arbitrarily denying claims for "medically necessary" care without adequate justification or explanation.
- Reducing a physician's payment for medically necessary care by "downcoding," meaning changing billing codes to indicate a doctor should be paid less. (For example, a doctor conducts an extensive office visit with a patient who has a number of health problems but is reimbursed only for a simple office visit that is far shorter and less complicated.)
- Bundling claims, meaning issuing a single lower payment for a group of related medical services, rather than paying for each service individually.
- Improperly reviewing claims by using computerized programs to automatically deny or reduce claims by downcoding.
Aetna officials say they are "surprised and disappointed" with the legal action and that "these complaints seek to engage in a policy quarrel with the managed care system — in this instance, payment disputes with doctors. This lawsuit and others like it do not advance any constructive goal."
Telephone calls seeking comment from AmeriHealth, CIGNA, Health Net, and Oxford were not immediately returned.
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