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Life Health > Health Insurance

Aetna Negotiates Managed Care Class-Action Settlement

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NU Online News Service, May 22, 2003, 12:50 p.m. EDT – Aetna Inc., Hartford, has hammered out a settlement with lawyers representing 700,000 U.S. doctors in a dispute over handling of managed care claims.

The agreement, which is subject to court approval, calls for Aetna to pay $100 million to the doctors, or about $140 per doctor.

The agreement also calls for Aetna to pay $50 million in legal fees, contribute $20 million to a health quality foundation, give doctors more information about how it pays bills, and set up an independent billing appeals process.

Aetna negotiated the agreement to resolve its share of the managed care lawsuits now being heard in Miami.

Lawyers began organizing suits against Aetna and other managed care companies in 1999. Lawyers for the doctors have accused carriers of conspiring to delay payments and deny valid claims.

A panel of federal judges transferred many of the cases to the U.S. District Court in Miami in October 2000. U.S. District Judge Federico Moreno declined in September 2002 to certify a class of plan members, but he did certify a class of doctors.

Dr. Donald Palmisano, president-elect of the American Medical Association, Chicago, suggests that the proposed Aetna settlement could serve as a model for other carriers. The association “expects this settlement to raise the bar for the entire health insurance industry on fair and open business practices,” he says.

State medical society representatives who participated in a press conference announcing the Aetna settlement agreement warned that they will continue to attack carriers that fail to make changes similar to those that Aetna has accepted.

Major health policy think tanks have come out with papers in recent weeks arguing that doctors and hospitals have gained too much clout over managed care plans, and that the shift has hurt efforts to rein in skyrocketing medical costs.

But Dr. Jack Rowe, Aetna’s chairman, says the settlement should help Aetna’s cost-management efforts by improving relations with doctors.

Paul Rooney, president of Employee Benefit Solutions, Newton, Mass., a benefits consulting firm, says an amicable resolution to the Miami litigation would help the entire health insurance market by strengthening the patient-doctor relationship.

“The relationship between the doctor and the patient is extremely important,” Rooney says.

If doctors and insurers fail to come together, “then politicians in Washington will be providing answers that neither side wants,” Rooney warns.


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