TDI Fines United … Again

For the second time in two years and fourth time since 2001, the Texas Department of Insurance (TDI) has fined UnitedHealthcare $4 million for violating the state's prompt payment law.

On Nov. 7, TDI Commissioner Mike Geeslin ordered United to pay a $4.4 million fine within 30 days because the company did not pay clean claims on time and did not live up to the promises it made in December 2005 when it was fined for not complying with the law.

United agreed in 2005 to process clean claims in accordance with the prompt payment law and to maintain a 98-percent or higher prompt payment compliance standard each quarter from January 2006 through June 2007.

It also agreed to:

  • Pay additional penalties of $3 million for each quarter it failed to achieve a 98-percent compliance standard for clean claims from all physicians and other health care professionals from January 2006 through June 2007;
  • Submit to verification of its compliance by an independent certified public accountant;
  • File timely quarterly complaint records that are "true, correct, and complete in all material respects"; and
  • Pay additional penalties of $1.5 million should it not file timely reports.

In his Nov. 7 order, Commissioner Geeslin said United failed to maintain a 98-percent or higher prompt payment compliance rate in the third quarter of 2006 and did not submit HMO complaint logs that were "true, correct, and complete in all material respects" in 2006 and the first quarter of 2007. He also said United did not categorize the complaints as prescribed by law and instead used its own complaint categorization methodology. He said United submitted complaint logs that "included complaints that did not relate" to its HMO business in Texas.

The commissioner ordered United to file reports that comply with the 2005 order or face an additional $3 million fine. 

United officials had not responded to a request for comment when this issue of Action was published.

Action , Nov. 15, 2007


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