Law Feature - July 2007
By Crystal Conde
In April, the Texas Medical Association and other state medical societies across the country witnessed another milestone for the approximately 900,000 physicians represented in a class action antiracketeering lawsuit against large for-profit HMOs. More than 90 percent of Blue Cross and Blue Shield (BCBS) health plans and the Blue Cross and Blue Shield Association agreed to make key changes in their business practices and restructure the way they administer and pay for medical care for Blue Cross enrollees.
The settlement includes a guaranteed cash payment of more than $128 million to physicians. All practicing Texas physicians can further benefit from the settlement, taking advantage of the $878 million in prospective relief from changes to Blue Cross practices, and, if a claim is filed, a share in the retrospective relief from payments previously unpaid.
Before physicians can file claims in the Blue Cross settlement, however, U.S. District Judge Federico Moreno in Miami must approve the settlement. Judge Moreno is presiding over the lawsuit. The preliminary approval date was scheduled for late May. Physicians were expected to receive notices, claim forms, and instructions in the mail by June or July.
Log on to www.texmed.org/rico or www.hmosettlements.com for updates on the settlements.
TMA already has helped Texas physicians receive reimbursement for millions of dollars in claims from settlements with other defendants in the Racketeer Influenced and Corrupt Organizations Act (RICO) case, including Aetna, CIGNA, Health Net, Prudential, Anthem/WellPoint, and Humana. (See " RICO Settlements Award Millions to Texas Physicians.")
Austin Regional Clinic (ARC) has received more than $168,000 in claims payments from WellPoint and CIGNA. ARC chief executive officer and founder Norman Chenven, MD, calls TMA a driving force nationally for resolution of the class action suits brought under the RICO Act.
"I don't believe Texas physicians would have had the individual leverage to deal with reimbursement from insurance companies," he said. "It has taken a class action suit and the collaborative activity of organized medicine to get adequate attention from the health plans and the legal system to resolve these problems."
In the latest settlement, Blue Cross agreed to:
- Pay valid, clean electronic claims within 15 days and paper claims within 30 days;
- Provide fee schedules to physicians;
- Use 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;
- Give physicians 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 to resolve disputes with physicians over many common billing disputes;
- Pay for the cost of recommended vaccines and injectibles and for administering them;
- Not automatically reduce the intensity coding of evaluation and management codes billed for covered services; and
- Establish a compliance dispute mechanism to address disputes regarding the Blues' compliance with the agreement.
Blue Cross and Blue Shield of Texas, Inc. is the largest physician network in the state, with more than 36,000 physicians and 400 hospitals in its networks.
"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.
Checks and Balances
Physicians' fight against insurance companies for their wrongful medical necessity practices and failure to reimburse for care given to patients began before the lawsuit's filing in 2001. Joe Cunningham, MD, an internal medicine physician in Waco and member of the TMA Board of Trustees, played a role in organizing individuals and resources to set the stage in the late 1990s for the eventual filing of the class action lawsuit.
During the past decade, Dr. Cunningham has witnessed a change in the way physicians and insurance companies work together. Now that physicians have demonstrated they are willing to fight for what they believe is right, the settlements have produced a system of checks and balances.
"First, there is a federal judge who has the authority to bring about change if you've got a complaint, if the companies are arbitrarily down-coding or amending contracts," he said. "In the past, they would do that and not even take your phone call. Now you've got a settlement, and you can go to court … and you've got somebody who already is up to speed."
Hold Their Feet to the Fire
A key element of the checks-and-balances system is a process that allows physicians to file compliance disputes. If doctors believe health care payment plans aren't adhering to a settlement agreement, they can contact the plan's compliance dispute facilitator to determine whether to file a complaint. (See " Compliance Dispute Procedure.")
Deborah Winegard, Aetna/CIGNA compliance dispute facilitator, says physicians' most common misconception is that the process takes a lot of time and money. Actually, filing a compliance complaint is free, and the form is simple to complete.
TMA's Hassle Factor Log program and payment advocacy staff can help physicians with the compliance dispute process. TMA members can submit a Hassle Factor Log online, by mail, or via fax. To get started, visit http://www.texmed.org/hasslefactorlog/. Or, call TMA's Payment Advocacy Department at (800) 880-1300, ext. 1414, or (512) 370-1414 to be directed to the appropriate reimbursement specialist.
Contact information for each plan's dispute facilitator is available at www.texmed.org/rico or at www.hmosettlements.com (select Compliance from the menu on the left to access the Settlement Enforcement Toolkit).
Physician advisory committees established under many of the settlement agreements, including that of BCBS, help resolve compliance disputes.
Former TMA President Bohn Allen, MD, is a member of CIGNA's Physician Advisory Committee. He counts among the committee's victories its assistance in resolving a dispute over the company's failure to recognize some codes amended with modifiers 25 and 57. CIGNA subsequently began recognizing the Medicare modifiers and agreed to explain on its Web site when it would not reimburse for services appended with those modifiers.
Dr. Allen describes insurance companies' receptiveness to advisory committees' recommendations as "fairly responsive."
But he cautions that future relations between health care payment plans and physicians are unpredictable because the settlement agreements eventually will expire. CIGNA's agreement expires late this year, dissolving the Physician Advisory Committee, as well. CIGNA will then form local or regional advisory committees.
"I think at this point, the health plans are simply biding their time until they get through the settlement agreements," Dr. Allen said. "Hopefully, the RICO lawsuits and settlement agreements have pointed out the importance and benefits to health plans of working with physicians rather than being in an adversarial role all the time."
Crystal Conde can be reached at (800) 880-1300, ext. 1385, or (512) 370-1385; by fax at (512) 370-1629; or by email at Crystal Conde.
RICO Settlements Award Millions to Texas Physicians
Texas physicians have received at least $11 million to date in cash payments from the settlements of the national class action antiracketeering lawsuits against Aetna, CIGNA, and WellPoint (see box below). More payments will follow from settlements with other health plan defendants for those who filed claims during the filing period for each settlement.
"These cases have settled, resulting in reimbursements to physicians for past harm - money you would not have received were it not for TMA's legal successes," said TMA President William W. Hinchey, MD.
"I am immensely proud of these results and all of the work we do in conjunction with our county medical societies. These lawsuits are just one example of TMA's ability to work on your behalf, and our success reflects the important role that organized medicine plays in our profession."
The payments to date include $7.5 million to Texas group practices and $2.5 million to individual Texas physicians. Academic practice plans, single specialty groups, and large group practices saw significant payments.
WellPoint $5.6 million
CIGNA* $3.3 million
Aetna $1.6 million
*Total does not include awards filed by a third party on behalf of physicians of unknown locations.
Source: Whatley Drake & Kallas
Back to article
Compliance Dispute Procedure
Settlements under the RICO lawsuit share the same step-by-step compliance dispute process. The following information is needed to challenge a violation of Section 7 of any of the plans' settlement agreements. Section 7 lists the business practice changes to which the health care payment plan has committed.
- Any physician who has not opted out of the settlement may file a dispute with the compliance dispute facilitator. Disputes must be filed within 90 calendar days of the date the dispute arose or after the physician reasonably became aware of the dispute, whichever is later.
- Medical societies in the lawsuit may file complaints on behalf of their members and assist physicians from any state on these settlements. "Additional Signatory Medical Societies" may also assist in some settlement agreements. For a list of these societies, visit www.hmosettlements.com .
- The compliance dispute form and Section 7 of the settlement agreement are available at www.hmosettlements.com and at www.texmed.org/rico .
- The form must be filed by the physician (or his or her office staff) and must include the physician's signature. The form should describe, using specific facts, the health plan's conduct that he or she believes constitutes a material breach of the health plan's obligation under Section 7 of the agreement. The physician should also specify which provision of Section 7 has been breached and describe how he or she has been harmed by the breach. The medical societies may assist in developing the description.
- Attach any supporting documentation to the form, including any correspondence between the physician and the health plan, explanations of benefits, and any relevant records in order for the facilitator to determine the merits of the complaint.
- Mail the completed form and attachments to the compliance dispute facilitator. No fee is required.
- After the facilitator receives the form, the facilitator will contact the physician to advise whether the form is properly completed and to obtain any additional documentation or information.
- The facilitator will review the form to determine that the dispute is not frivolous, cannot easily be resolved, and is not a matter to be resolved by the dispute processes provided for in Section 7.10 or 7.11 of the settlement agreement.
- The facilitator will handle the dispute on the physician's behalf without charge and keep the physician informed as the compliance dispute process takes its course.
Contact information for each plan's compliance dispute facilitator is at www.texmed.org/rico . It also can be found at www.hmosettlements.com (select Compliance from the menu on the left to access the Settlement Enforcement Toolkit).
Back to article
Keeping Aetna's Feet to the Settlement Fires
Here is a sample of some of the compliance disputes involving Aetna that arose after Aetna settled its portion of the antiracketeering lawsuit.
Dispute: Aetna wasn't paying for certain evaluation and management visits appended with modifier 57 to indicate decision for surgery, thereby extending the global period for surgery beyond that prescribed by the Centers for Medicare & Medicaid Services (CMS).
Resolution: Aetna changed its payment practices to match those of CMS. From Jan. 1, 2007, to April 30, 2007, physicians were able to resubmit claims for dates of service from Jan. 1, 2005, until Feb. 11, 2006 (when the policy changed).
Dispute: Aetna was not paying for certain CPT procedure codes, such as visual acuity screening and development testing, when billed with an evaluation and management code appended with modifier 25.
- Aetna fixed the system to pay the affected codes, effective Nov. 12, 2006.
- Aetna paid all the individual petitioners back to May 21, 2003.
- Aetna paid all other physician claims with the affected codes for dates of service back to July 1, 2004.
- Aetna changed its coding policies regarding pulse oximetry (CPT 94760, 94761, 94762) and urinalysis (CPT 81002, 81003) to allow payment when billed with an evaluation and management code appended with a modifier 25 and reprocessed claims with these codes with dates of service back to May 1, 2006. Physicians must append the modifier 25 to the evaluation and management code to be paid with on these claims.
- A task force of state medical society and Aetna representatives was convened to make recommendations on improving the Aetna Provider Web site to make it more user-friendly and transparent for physician offices.
July 2007 Texas Medicine Contents
Texas Medicine Main Page