Aetna sued over out-of-network pay and referrals

The California Medical Assn. and more than 50 physicians are suing Aetna over alleged retaliation against doctors who refer patients for out-of-network care.

The medical society and doctors say Aetna is underpaying out-of-network physicians, refusing to authorize some out-of-network services and illegally terminating the contracts of doctors who make such referrals.

The insurer’s practices violate California law and interfere with doctors’ medical decisions, said Long X. Do, CMA legal counsel.

“When a physician within Aetna’s network acts in the best interest of a patient to refer to an out-of-network provider, that physician is exercising their best medical judgment,” he said. “Aetna is trying to get in the way of that doctor-patient relationship.”

In a statement, Aetna spokeswoman Anjanette Coplin called the suit baseless and denied the insurer is mistreating physicians.

“Doctors who entice patients to have procedures performed at out-of-network facilities that they own without the patient’s knowledge are putting profits over their patients,” she said. “The wildly inflated bills of these facilities drive up the out-of-pocket costs for unwitting patients and needlessly add to premium costs for everyone.”

The lawsuit, filed July 3 in Superior Court of the State of California, County of Los Angeles, was joined by a group of patients and several county medical societies in California. The plaintiffs claim some of Aetna’s insurance policies enable patients to receive out-of-network care. However, Aetna discourages such practices and regularly refuses to pay for them, the suit claims.

Similarly, doctors’ contracts with Aetna do not specifically forbid all out-of-network referrals, the suit said. Yet, when doctors make such referrals, Aetna frequently threatens them with a “rate adjustment” or termination from Aetna’s network, according to the suit.

The plaintiffs are seeking an injunction against Aetna’s practices, punitive damages and restitution for patients who have paid out of pocket for care.

Physicians have been strong-armed by Aetna for years over out-of-network decisions and suffered in silence, said Rocky Delgadillo, an attorney and CEO of the Los Angeles County Medical Assn., a plaintiff in the suit.

“Doctors in LA County and doctors around the state felt as though Aetna was bullying them and using their clout in an illegal and immoral way,” he said. “These are doctors who are just trying to stay above water, and they have to deal with these kind of issues from Aetna. We’re asking the court to step in and stop this practice.”

Aetna fighting overbilling

The CMA’s lawsuit follows four legal challenges filed by Aetna in the last year related to overbilling claims against physicians and health centers. The suits, filed in courts in California, New Jersey, New York and Texas, accuse doctors of drastically overbilling for out-of-network services. They also allege that some in-network physicians receive kickbacks for the references.

The CMA’s legal challenge is retaliation against the insurer for filing the suits, Aetna said.

“We have sued some of these same doctors and surgery centers named in this suit for their egregious billing practices,” Coplin said in an email. “This is a countersuit disguised as a class-action lawsuit. We will continue to pursue medical providers whose charges are so grossly out of line.”

The CMA is aware of Aetna’s lawsuits, but said its suit has nothing to do with them. CMA’s claim centers on Aetna’s policies and practices, Do said.

Delgadillo hopes the CMA lawsuit will encourage physicians in other states who have experienced similar treatment by Aetna to come forward. Already, the medical society has received calls from physicians in New Jersey, South Carolina and the District of Columbia who have similar stories, he said.

“Doctors’ ability to provide the best service is being compromised,” Delgadillo said. This “damages the doctor-patient relationship, and it damages patients’ access to care.”