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Doctors groups allege WellPoint's collusion cost them millions

A lawsuit accuses the owner of Anthem Blue Cross of fixing prices for 'out-of-network' procedures.

March 26, 2009|Lisa Girion

Anthem Blue Cross of California parent WellPoint Inc. colluded with database firm Ingenix to fix prices in a multistate scheme to underpay doctors for so-called out-of-network medical care, physician organizations contended in a lawsuit filed Wednesday.

The American Medical Assn., the California Medical Assn. and other state medical organizations said in the suit filed in federal court in Los Angeles that the scheme cost physicians millions of dollars and resulted in patients paying more than they should have.

Similar lawsuits were filed last month against WellPoint competitors Aetna Inc. of Hartford, Conn., and Cigna Corp. of Philadelphia.

Ingenix's price database is so widely used to set reimbursement rates that the litigation is believed to affect seven out of 10 people with health insurance.

Indianapolis-based WellPoint said in a statement that it was committed to providing appropriate reimbursement for out-of-network services. The company said it was reviewing the suit and had no further comment.

An earlier AMA suit against Ingenix parent UnitedHealth ended in a tentative settlement, with the company agreeing to pay $350 million.

Earlier this year, Minnetonka, Minn.-based UnitedHealth agreed to shut down the database. In exchange, New York Atty. Gen. Andrew Cuomo dropped an investigation. Cuomo had accused Ingenix of cheating patients by using faulty data to reduce out-of-network payments.

Ingenix used claims information from client insurers to establish "usual and customary" payments for care delivered by physicians who do not have rate contracts with the health insurance companies.

Physicians contend that those data do not accurately reflect local market rates. Insurers counter that wide variations in physician prices drive up costs.

A new database is being developed under the supervision of the New York attorney general's office. UnitedHealth agreed to contribute $20 million toward setting up the new database. Aetna and WellPoint have agreed to chip in $20 million and $10 million, respectively.

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lisa.girion@latimes.com

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