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The state's largest health care payment plan has settled a class action lawsuit filed under the Racketeer Influenced and Corrupt Organizations Act. More than 90 percent of Blue Cross and Blue Shield health plans and the Blue Cross and Blue Shield Association have agreed to implement key business practice changes and to restructure the way they administer and pay for medical care for Blue Cross enrollees.
The settlement, announced April 27, includes a guaranteed cash payment of more than $128 million to class members. All practicing Texas physicians can benefit from the settlement, receiving prospective relief from changes to Blue Cross practices, and, if a claim is filed, retrospective relief for previously unpaid claims.
Physicians can expect to begin receiving official notice of the settlement of the federal anti-racketeering against Blue Cross and Blue Shield on July 27. The notices will include information on filing a claim.
The settlement must be approved by U.S. District Judge Federico Moreno in Miami. Judge Moreno has presided over the lawsuits against Blue Cross, Aetna, CIGNA, Health Net, Prudential, Anthem/WellPoint, and Humana, other large for-profit HMOs since they were filed in 2001. For updates, visit www.hmosettlements.com.
TMA was involved in the case, including the settlement negotiations, since its filing but not as a formal plaintiff. The Connecticut State Medical Association was the state medical society plaintiff along with several physicians. TMA was a formal party with respect to several of the other defendants in the original class action against the other 10 major carriers and is a signatory to the BCBSTX settlement.
In the settlement, which is similar to previous agreements with Aetna, CIGNA, and other defendants, Blue Cross agreed to many reforms. They include agreeing to:
- Ensure the payment of valid clean electronic claims within 15 days and paper claims within 30 days;
- Provide fee schedules to physicians;
- Implement a definition of medical necessity that makes sure patients are entitled to receive medically necessary care as determined by a physician exercising clinically prudent judgment in accordance with generally accepted standards of medical practice;
- Provide physicians with access to an independent medical necessity external review process;
- Use clinical guidelines based on credible scientific evidence published in peer-reviewed medical literature (taking into account Physician Specialty Society recommendations, the views of physicians practicing in the relevant clinical areas, and other relevant factors) when making medical necessity determinations;
- Establish an independent external review board for resolving disputes with physicians concerning many common billing disputes;
- Pay for the cost of recommended vaccines and injectibles and for the cost of administering them;
- Not automatically reduce the intensity coding of evaluation and management codes billed for covered services;
- Establish a compliance dispute mechanism to address disputes regarding the Blues' compliance with the agreement; and,
- Establish and/or maintain physician advisory committees.
"Given the Blues' size in Texas and nationwide, this settlement should have an immediate, substantial, and positive impact on our patients and our practices, said TMA President William W. Hinchey, MD. "It will help us return our focus to where it should be: on allowing physicians to manage patient care."
When will the Settlement money be distributed?
Once the calculations are finalized, an award confirmation postcard will be sent to all eligible claimants to confirm their award (such as how many physicians for each group, and how many shares). As claimants respond, the total share count will be changing; once the deadline for claimants to respond has passed, the exact calculation will be finalized to determine the share amounts. Once the share amounts are calculated, disbursements will move forward.
Unfortunately, a timeline for disbursements cannot be provided until right before the disbursements since there are appeals that have been filed and are unresolved. Once the judge has affirmed the Final Orders and Judgements after the appeals have been resolved, estimates for the final count and calculations will be provided.
The settlement, along with additional information about the Blues' commitments, can be viewed at HMOCrisis.com.
Last Published: 6/23/2008 Print this page
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