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March 28, 2011 at 08:00 PM
The North Carolina department negotiated the fines in connection with a settlement agreement with CIGNA Healthcare of North Carolina Inc., a unit of CIGNA Corp., Philadelphia (NYSE:CI), officials say.
As required by North Carolina state law, the fines will go to the state public school system, officials say.
CIGNA Healthcare also agreed to pay about $638,000 in refunds and credits to affected employer group policyholders, officials say.
The North Carolina department discovered the problems during an exam that begin in September 2005 and covered the period from 2002 through 2004, officials say.
The violations included “widespread failure to maintain adequate records in numerous areas of review, failure to accurately and consistently calculate premium rates in accordance with rating methodology filed with and approved by the department; failure to timely process precertification requests; … [and] failure to process claims timely.”
CIGNA also failed to respond to member communications in a timely fashion failed to submit accurate filings certifying compliance with North Carolina advertising laws, and failed to provide sufficient monitoring of the activities of delegated entities, officials say.
