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WellPoint Ordered Into Group Arbitration

July 23, 1998|Bloomberg News

WellPoint Health Networks Inc. was ordered by a California judge to submit to arbitration with a group of as many as 13,000 doctors who say the managed-care company violated its contract by paying them less than promised for their medical services. San Francisco County Superior Court Judge David A. Garcia ruled last week that the physicians have the right to compel arbitration as a group, instead of individually, as WellPoint wanted, because their claims are similar. The decision is a setback for Woodland Hills-based WellPoint, which is a licensee of Blue Cross and Blue Shield, in its 3-year-old payment dispute with as many as a third of its participating doctors. "This case is about physicians signing a contract with Blue Cross to provide services at set fees and Blue Cross breaching that contract," said Edward Sangster, an attorney for the physicians. WellPoint officials couldn't immediately be reached for comment. The company's shares slid $2.38 to close at $72.31 on the NYSE.

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