Steven Wevodau - Accident & Health Insurance News

Insurer settles in New York state for $50 million - posted by Steven Wevodau

By Rob Varnon
STAFF WRITER
Updated: 01/20/2009 12:22:33 AM EST

Minnesota-based UnitedHealth Group, which has a large presence in Connecticut, said on Jan. 13 it approved a $50 million agreement to settle price-gouging allegations.

United Health Group’s problems started in February 2008, when New York Attorney General Andrew Cuomo — in response to complaints in his state — announced he was investigating its Igenix Inc. subsidiary, which operates computer databases used to determine reimbursement rates for medical procedures.

UnitedHealth agreed to pay the $50 million to establish an independent database that will replace its Ingenix database products.

The new nonprofit organization will also have to give consumers information about medical costs.

A court must still decide whether there is any underpayment. There was no mention of patients seeing some sort of repayment.

UnitedHealth would not comment on the issue beyond its press release.

The company said there will be no impact on jobs at its Ingenix facility in Rocky Hill, or its Trumbull UnitedHealth and Oxford Health Plans operations.

“For the past 10 years, American patients have suffered from unfair reimbursements for critical medical services due to a conflict-ridden system that has been owned, operated and manipulated by the health insurance industry,” Cuomo said in a press release. “This agreement marks the end of a flawed system.”

Shares of UnitedHealth closed down 26 cents to $25.36 in trading on the New York Stock Exchange.

Cuomo’s office began investigating complaints that Ingenix-produced numbers for out-of-network expenses were far lower than what doctors were charging, which meant UnitedHealth customers were paying too much.

When a person uses an out-of-network doctor for treatment, the insurer usually promises to pay a portion, generally 80 percent, of the bill based on a database that catalogs the cost of medical treatments across the country.

For example, if a doctor charges $200 for a procedure when the database says the usual rate is $100, the insurer would only pay 80 percent of the database price, or $80, leaving the patient to pay the remaining $120.

Because Ingenix is used by almost every other health insurance company in the nation, Cuomo said his investigation is continuing into those companies.

The New York Attorney General won praise from Connecticut Attorney General Richard Blumenthal.

“Today’s settlement between New York and UnitedHealth Group — eventually establishing a new reimbursement rate system — is a significant step toward protecting patients who may have been shortchanged millions of dollars over several years by insurers,” Blumenthal said in a prepared statement.

He is conducting his own investigation into the matter.

“My investigation into UnitedHealth Group, its Ingenix subsidiary and several other insurers is continuing to ensure that any company that may have misused or manipulated reimbursement rates is held accountable, including possible restitution for consumers.”

Blumenthal and Cuomo said a major concern was that Ingenix, owned by one insurer and collecting fees from others, was beholden to the insurance industry and was therefore compromised in its ability to deliver unbiased price information.

Mark Thompson, executive director of the Fairfield County Medical Association, which represents doctors, said the county’s doctors and patients have been hit with unfair reimbursement rates for years, but no one has done anything about it until now.

“We were questioning a decade ago the veracity of the information that the insurance companies were submitting as the usual charge,” said Thompson. “We talked to our legislators about that. We talked to the insurance companies, and when we asked them to show us how they came up with their data, they said it was proprietary.”

“It’s kind of like the Madoff situation. There were red flags going up,” Thompson said, referring to allegations of a $50 billion Ponzi scheme.

He said he hopes Cuomo’s actions lead to changes in Connecticut, as well.

Hartford-based Aetna Inc. and Bloomfield-based Cigna Corp. have also been subpoenaed by Cuomo about their use of Ingenix rates.

In a prepared statement, Aetna praised the move to an independent, nonprofit organization that will provide this data in the future.

Cigna noted this agreement does not involve it and said it uses Ingenix properly.

Cigna said this situation has occurred in part because consumers have not been given access to the real costs of health care, and the company supports efforts to do that.

Material from the Associated Press was used in this report.

Tags: Aetna Inc., Cigna Corp, Steve Wevodau Aetna Inc., Steve Wevodau Cigna Corp, Steven Wevodau Aetna Inc., Steven Wevodau Cigna Corp, UnitedHealth Group

Walgreen announces Complete Care wellness program

posted by Steven Wevodau

NEW YORK — Walgreen Co. said Wednesday it is rolling out a program it says will save employers and health insurers money, while giving discounts to employees at its brand name drugstores.

The program, called Complete Care and Well-Being program, is being launched through Walgreen’s Take Care Health Systems business. Deerfield, Ill.-based Walgreen said Complete Care will offer clear pricing to employers and give workers a 15 percent discount on Walgreen brand products and lower prices on prescription drugs.

The company did not offer any details on the cost of starting the program.

Walgreen operates more than 300 work site health centers at manufacturing facilities and employer campuses. At those centers, workers can see doctors and nurses for consultations, physicals and urgent care at the clinics as well as filling prescriptions and getting help with medication.

Walgreen says Complete Care and Well-Being will also help to health insurers and pharmacy benefits managers. It said the program will lead to greater satisfaction for patients, who can be seen quickly at clinics and get the discounts, while benefiting insurers and PBMs by reducing health care costs and making sure patients with chronic illnesses keep taking their prescriptions.

Walgreen has its own pharmacy benefits management business, called Walgreens Health Initiatives.

The company runs 6,636 drugstores in 49 states, and said half the U.S. population lives within two miles of at least one of its stores.

Walgreen bought Take Care Health Systems in May 2007. Take Care operates 322 clinics in Walgreen stores, and has entered partnerships with health insurers including Aetna Inc., Cigna Corp., Coventry Health Care Inc., Humana Inc., UnitedHealth Group Inc.

Tags: Aetna Inc., Citgna Corp., Coventry Health Care Inc., Humana Inc., Steve Wevodau Aetna Inc., Steve Wevodau Cigna Corp, Steve Wevodau Coventry Health Care Inc., Steven Wevodau Aetna Inc., Steven Wevodau Cigna Corp, Steven Wevodau Coventry Health Care Inc., UnitedHealth Group Inc.

Aetna Introduces New Chicagoland Plan for Small Businesses

posted by Steven Wevodau

CHICAGO–(BUSINESS WIRE)–Aetna (NYSE: AET) is introducing a health insurance plan with the goal of helping small businesses in under-served communities offer health insurance to their employees for the first time ever.

Called the Aetna Illinois Community PlanSM, it is designed for Chicago-area small businesses with 2 to 50 eligible employees and is approximately 25 percent less expensive than other Aetna small group insurance plans with similar benefits.

Aetna’s Illinois Community Plan is available through insurance brokers to members and member affiliates of the Illinois Hispanic Chamber of Commerce, which is open to anyone.

“We’re very excited about this affiliation,” said Omar Duque, President and CEO of the Illinois Hispanic Chamber of Commerce. “We’re hopeful this plan will allow businesses to offer their employees and their families health insurance who have never been able to afford it before.”

“This plan was designed in direct response to the needs raised by the local business community. They told us they needed a health plan that was affordable for the business and their employees, close to home, easy to understand and with robust benefits,” said Marty Castro, vice president of external affairs for diverse market strategies at Aetna’s Chicago office. “So, we designed this plan to make sure it includes hospitals and health care providers in the neighborhoods where people live. There are more than 40 hospitals, 2,400 primary care physicians, 740 Ob/Gyns, 5,600 specialists and 2,000 behavioral health providers participating in this plan. Hospitals and physicians are located in Cook, DuPage, Lake, Kane, Kankakee and Will counties.”

Aetna’s Illinois Community Plan is a tiered plan, meaning there are three tiers of health care providers. If people use the health care providers in the first tier, known as the “Tier 1 community network,” generally they have the least out-of-pocket expense.

The plan focuses on prevention. When using the “community network,” co-pays and deductibles are waived for well-baby exams, child exams, immunizations, adult physical exams, routine mammograms, eye exams and routine gynecological exams. In addition, the plan covers use of “walk-in” clinics that belong to the network.

“There are insurance plans in the marketplace that advertise they’re ‘low-cost,’ but once you check into it, you find they have substantial out-of-pocket costs and don’t cover many things. Aetna’s Illinois Community Plan is one with limited out-of-pocket expense that covers a full spectrum of health care services – doctor’s visits; hospitalizations; lab and x-ray services; outpatient physical, occupational and speech therapy; chiropractic services; outpatient surgery; emergency room and urgent care; and generic prescription drugs,” said Aetna’s Castro. In addition, those with Aetna insurance have access to a wide array of health information and wellness resources on the Aetna web site.

The plan includes hospitals and physicians located in Chicagoland’s Hispanic communities, where many speak Spanish. The Spanish-language website for the new plan (www.aetnaILCommunityPlan.com) will go live in late January and includes a DocFind link to search the physician database. In addition, Aetna offers a Spanish version of its website (www.aetna.com/espanol/) and partners with the Financial Planning Association on a Spanish language informational website about health insurance (www.planifiqueparasusalud.com)  A DocFind® site for the Illinois Community Plan is currently available in English: http://www.aetna.com/docfind/custom/ilcommunitynetwork/ 

“While direct medical costs account for 24 percent of employers’ health care expenses, the cost of on-the-job productivity loss due to illness accounts for 63 percent,” said Castro. “Employers need to look not just at the cost of health benefits when considering whether to offer health insurance, but at the bigger picture of how employee health conditions are affecting benefit results and productivity. These days, having health insurance is critical to a family’s and a community’s financial well-being and security.”

Aetna is well-known for its involvement in Chicago’s Hispanic community. Over the last 3-1/2 years, Aetna and the Aetna Foundation have awarded more than $2 million to organizations in Chicago, most of which are providing health and wellness services in Chicago’s under-served communities, including the Hispanic community. In addition, Aetna’s Chicago employees volunteer thousands of hours in Chicago’s communities and are committed to serving the health needs of our neighbors.

About Aetna

Aetna is one of the nation’s leading diversified health care benefits companies, serving approximately 37.2 million people with information and resources to help them make better informed decisions about their health care. Aetna offers a broad range of traditional and consumer-directed health insurance products and related services, including medical, pharmacy, dental, behavioral health, group life and disability plans, and medical management capabilities and health care management services for Medicaid plans. Our customers include employer groups, individuals, college students, part-time and hourly workers, health plans, governmental units, government-sponsored plans, labor groups and expatriates. For more information, see www.aetna.com.

Contacts

Aetna

Scot Roskelley, 312-928-3034

roskelleye@aetna.com

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