Getting physicians what they're owed: the aftermath of the Ingenix settlement

The AMA and others in organized medicine demand health plans make good on past underpayments for out-of-network care. Aetna and Cigna learned that when they were taken to court.

Posted March 23, 2009.

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It's all well and good that health insurers are contributing -- $93 million at last count -- to replace the Ingenix database that was at the center of New York Attorney General Andrew Cuomo's investigation into why -- for years -- insurers underpaid for out-of-network care.

However, assurances of future fair payment do not make up for years of shortchanging physicians and patients by feeding Ingenix inaccurate data or relying on that data in setting usual, customary and reasonable rates. Physicians are owed what they should have been paid in the first place.

Those assertions are at the heart of a lawsuit filed by the Litigation Center of the American Medical Association and State Medical Societies, as well as numerous others in organized medicine and individual physicians. The defendants are Aetna and Cigna, two of the biggest plans that settled with Cuomo regarding their involvement with Ingenix.

Of the 10 insurers that have settled with Cuomo, only three have committed to any redress. Excellus Health Plan, New York's largest nonprofit insurer, and Capital District Physicians' Health Plan, as part of their settlement, agreed to go back over the last six years and either reprocess or recalculate out-of-network claims, and then cover any underpayment.

The third plan, UnitedHealth Group, which owns Ingenix, agreed in February to pay $350 million to doctors who were underpaid based on Ingenix data. That settled a 9-year-old, nationwide, class-action lawsuit brought by the AMA and others in organized medicine. United's settlement was a separate action from the company's deal with Cuomo to stop using Ingenix, which occurred around the same time.

Of the seven remaining plans, Aetna and Cigna were targeted for lawsuits first because of their size, their relatively large contribution of price information to the Ingenix database and the available evidence from Cuomo's office. Larry Downs, general counsel for the Medical Society of New Jersey, one of the many plaintiffs (with more on the way), said it is possible more lawsuits could come.

The allegations in the separate lawsuits, both filed in February in the U.S. District Court of New Jersey, are similar. The lawsuits state the plans contributed and used payment information from Ingenix that they knew did not conform to UCR.

The plaintiffs say that by not paying market rates and forcing physicians to expend great time and energy in an attempt to get a legitimate UCR payment, the plans were putting pressure on nonparticipating physicians to join the plans' own networks to pay them at a discount. (The lawsuits also say that, particularly in the case of Cigna, the plans found ways to reduce out-of-network rates even if they didn't use Ingenix.)

Aetna and Cigna dispute the charges, and like all the plans that settled with Cuomo, did so without admitting wrongdoing. Cigna representatives said their payments for out-of-network care have been "robust and fair," while Aetna said it would like to have a "collaborative dialogue" with physicians rather than a lawsuit.

Physicians, long bedeviled by the Ingenix database, would actually like to see some robust and fair pay, and now would be a good time for health plans to have some collaborative dialogue with their accountants to get some checks written. But for what health plans won't do willingly, organized medicine's lawsuit is in motion to get doctors what they should have received all along.

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