Local Insurers Fined for Late Reimbursements

Anthem Blue Cross and Health Net are among seven health insurance plan providers in California required to pay fines for untimely and unfair claims payment practices, announced California’s Department of Managed Health Care. Anthem Blue Cross is being fined $900,000, and Health Net is being fined $750,000. The other five plan providers being penalized are Blue Shield of California, United/PacifiCare, Kaiser Foundation Health Plan, Cigna and Aetna. The seven insurers are receiving a total of $5 million in fines, along with restitution to doctors and hospitals. The penalties resulted from an 18-month investigation by the managed health care department, which was launched in response to complaints by health care providers. The investigation found that all seven plan providers violated the legal threshold of paying 95 percent of their claims correctly. The audits also showed that five of the seven plans violated provider dispute resolution procedures, which health care providers must use to protest an underpayment or claims denial and get a corrected payment. “Our clear and consistent message is that California’s hospitals and physicians must be paid fairly and on time,” said Cindy Ehnes, director of the managed health care department. “Providers are struggling to stay afloat in a very difficult business environment. Improper payment of provider claims runs the risk that our health care delivery system could grind to a halt.” In addition to paying the fines and restitution, the plan providers are making changes to their payment processes. Those changes include dedicating additional staff and resources, providing additional management and oversight and re-vamping entire internal processes to avoid further violations. Jessica Vernabe