Los Angeles Business Journal

Doctors File ‘Denial of Coverage’ Lawsuit Against Aetna

By Deborah Crowe Originally published July 3, 2012 at 3:10 p.m., updated July 3, 2012 at 4:47 p.m.

Associations representing thousands of California doctors filed suit in Los Angeles on Tuesday against Aetna Health of California. The lawsuit claims that the health insurer routinely denies patients access to out-of-network doctors, even if the patient has paid for a policy that gives them that option.

The lawsuit accuses the subsidiary of Hartford, Conn.-based insurer Aetna Inc. of threatening not to pay claims if members visit doctors outside the Aetna provider network. It also alleges that network doctors were threatened with having their Aetna contracts terminated if they refer patients outside the network.

The lawsuit was filed in Los Angeles County Superior Court by the Los Angeles County Medical Association, California Medical Association and a coalition of health care organizations and providers.

“The insurance company interferes not only with doctor-patient relationships, but also harms the ability of California health care providers to get sick people the care they need in a professional and timely manner,” said Rocky Delgadillo, former Los Angeles city attorney and now chief executive of the Los Angeles County Medical Association.

The lawsuit pertains to Aetna’s higher-cost preferred provider organization (PPO) and point-of-service (POS) policies, which are marketed as giving members with greater flexibility to get care from out-of-network providers.

Aetna said in a statement that it considers the doctors’ lawsuit to be a countersuit to a lawsuit that the company filed in February against several California surgical centers for “egregious billing practices.”

The insurer claims that physicians sent Aetna members to Bay Area Surgical Management and other facilities around the state without revealing that they had an ownership interest in those facilities or were getting paid for their referrals.

“This is clearly retaliation against Aetna for our actions to prosecute physicians who are not looking out for our members,” the company said in an email. “We find it troubling that the California Medical Association and other county medical associations would support this type of egregious behavior from physicians.”

Other plaintiffs in lawsuit include the Ventura County Medical Association, Santa Clara County Medical Association, more than 60 individual physicians, four surgery centers and a California patient allegedly affected by Aetna’s actions.

LACMA called Aetna’s response a “recycling (of) unproven allegations” and noted that doctors and associations beyond those named in Aetna’s earlier lawsuit had joined in an “unprecedented collective voice of doctors up and down this state.”