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New York Fines Health Carrier

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New York state has imposed $850,000 in fines on Aetna Inc. in connection with allegations of problems with explanation-of-benefit (EOB) forms.

The New York State Insurance Department says units of Aetna Inc., Hartford (NYSE:AET), failed to issue all necessary explanation-of-benefit forms, issued some forms that failed to identify the service for which the claim was made, and failed to give required information about filing appeals.

In some cases, Aetna units also violated the New York “prompt pay” law, officials say.

Aetna already has agreed to revise its procedures for issuing explanation-of-benefit forms and develop a plan for improving prompt pay law compliance, officials say.

Aetna notes in a statement that the problems were uncovered in an exam that covered operations from 2001 to 2005.

“The majority of the findings have already been corrected,” the company says. “The department is just now announcing the settlement. All the utilization review findings noted in the examination were corrected during 2007 and 2008, and all process errors related to EOBs have been corrected and EOBs issued by our claim systems how have a more consistent look and feel.”

- Allison Bell