December 11, 2012
Aetna Settlement Favorable to Psychologists and Their Patients
Aetna has agreed to a $120 million settlement of a class action lawsuit filed by psychologists alleging that the company used a faulty database to underpay claims for services from out-of-network providers
WASHINGTON—Aetna has agreed to a $120 million settlement of a class action lawsuit filed by psychologists, other health care professionals and patients in federal court in New Jersey. The lawsuit alleges that Aetna used a faulty database to underpay claims for services from out-of-network providers.
Aetna licensed the Ingenix database to determine payment for out-of-network services. The Ingenix database, however, allegedly was flawed and consistently understated what is known as the “usual, customary and reasonable” (UCR) reimbursement rate. The UCR is supposed to represent the “going rate” that health care professionals charge for their services in a particular geographic area of the country.
These allegations were the basis for a class action lawsuit against Aetna filed in 2009 by providers, policy holders and health professional associations, including the New Jersey Psychological Association (NJPA). A settlement was reached with Aetna on Dec. 7.
Aetna, United HealthCare, owner of Ingenix, and other insurers agreed to stop using the Ingenix database pursuant to settlements with the New York attorney general in 2009. That settlement led to the creation of the FAIR Health database, designed to replace the Ingenix system with a more accurate and transparent system. Insurers nationwide can use the FAIR Health database to determine reimbursement rates for out-of-network claims. Like several insurers, however, Aetna bases its rates instead on Medicare rates.
Barry Helfmann, PsyD, NJPA director for professional affairs, said, “We’re pleased with the outcome of this case and glad to see patients and their psychologists getting compensation for past underpayments.”
Additional class action suits against other companies that used the Ingenix database are still pending. They include a case in which the California Psychological Association is one of the plaintiffs against the WellPoint/Anthem companies, and other cases in which NJPA is a plaintiff against CIGNA and Horizon Blue Cross Blue Shield of New Jersey.
“We hope that cases like these will result in fairer reimbursement practices by the insurance companies and ultimately create greater access to mental and behavioral health services for patients,” said Katherine C. Nordal, PhD, executive director of the American Psychological Association Practice Organization, which works with state psychological associations to provide legal, policy, communications and other support on managed care lawsuits and advocacy issues.
The American Psychological Association Practice Organization is an affiliate of the American Psychological Association, the largest scientific and professional organization representing psychology in the United States. APA's membership includes more than 137,000 researchers, educators, clinicians, consultants and students.