AMA, others join lawsuits against Aetna, Cigna

By Molly Merrill
09:42 AM

Two physician-class-action lawsuits have been filed against Aetna Health, Inc. and the CIGNA Corporation.

The lawsuits, filed by the American Medical Association, several state medical associations and individual physicians, claim the companies used skewed data provided by UnitedHealth Group subsidiary Ingenix to under-reimburse physicians.

The lawsuits, filed Monday in New Jersey federal court, contend that for more than a decade the two health insurance companies used a corrupt system to underpay physicians for out-of-network medical services and forced patients to pay an excessive portion of the costs.

"We can no longer ignore the improper business practices of health insurers who decide to play by their own rules without regard to patients, or the legitimate costs required to care for them," said AMA President Nancy H. Nielsen, MD.

Medical societies in Connecticut, Texas, California and other states have received settlements from past lawsuits filed against Aetna and CIGNA. With the settlements, two organizations were formed - Physicians' Foundation for Health Systems Excellence and Physicians' Foundation for Health Systems Innovations - which aim to develop and market an open-source electronic medical records system to physicians nationwide.
 
Evidence from a recent investigation launched by New York Attorney General Andrew Cuomo found that the Ingenix data was manipulated to allow health plans to scam physicians by shortchanging reimbursements on medical bills.

Last month, UnitedHealth Group reached an agreement with Cuomo in which it committed $50 million to fund a not-for-profit entity to develop and own a new, independent database to replace the Prevailing Health Charges System (PHCS) and Medical Data Research (MDR) databases owned by Ingenix. The agreement stipulates that when the new database is ready, Ingenix will close the PHCS and MDR databases.

"We are committed to increasing the amount of useful information available in the healthcare marketplace so that people can make informed decisions, and this agreement is consistent with that approach and philosophy," said Thomas L. Strickland, executive vice president and chief legal officer of UnitedHealth Group.

The Litigation Center of the AMA and State Medical Societies is supporting the lawsuits in partnership with the Connecticut State Medical Society, Medical Society of New Jersey, Medical Society of the State of New York, North Carolina Medical Society and Texas Medical Association.

"Through our lawsuits, the AMA and our partner medical societies seek to reform the payment systems used by Aetna and CIGNA by ending their dependence on the Ingenix database," said Nielsen. "The lawsuits also seek relief for physicians who were seriously harmed by Aetna and CIGNA through the insurers' long-term use of the flawed Ingenix database."