Aetna U.S. Healthcare Will Fight Georgia Lawsuit Alleging Late Payments

The American Medical Association and the Medical Association of Georgia filed a class action lawsuit against Aetna U.S. Healthcare, claiming the insurer does not pay physician claims in a timely manner. Aetna U.S. Healthcare, a subsidiary of Aetna Inc., denied the charges and said class treatment of the issue is "unwarranted."

Among other things, the lawsuit -- filed Feb. 16 in Fulton County Superior Court -- alleges that Aetna U.S. Health care routinely delays claims payments, violating Georgia law and the insurer's contract with physicians and other providers. The suit also claims that Aetna U.S. Healthcare is unjustly enriched because of its payment delaying and that the insurer uses the funds due physicians for its own profit.

The class action lawsuit seeks a judicial declaration that Aetna's conduct is illegal and an injunction preventing Aetna from continuing to delay payment of claims.

Georgia's prompt pay law stipulates that insurers and other payers remit payments as soon as they receive a claim. The law penalizes insurers that do not pay claims within 15 working days of receipt, by adding an 18 percent annual surcharge -- unless the insurer states the reasons it has for failure to pay the claim in whole or in part and provides "a written itemization of any documents or other information needed to process the claim." Explanations must be specific for each individual claim.

Aetna U.S. Healthcare will fight the suit, said company spokesman Robert Kremer. "We believe we are in substantial compliance with the Georgia law requiring prompt claims payment and that the AMA's complaint lacks merit," Kremer said, citing an official statement released by Aetna U.S. Healthcare on Feb. 18. The statement went on to say that the insurer's Southeast region, including Georgia, processes some 560,000 HMO claims per month.

"In the Atlanta area specifically, during January 90 percent of HMO claims were paid in under 11 days, with the balance largely consisting of incomplete claims or those requiring additional information or further review." The insurer also said that 90 percent of claims that were adjudicated electronically through the company's E-Pay program, were paid in under three days.

"Given the prompt payment of nearly all claims, we also believe that class treatment of this issue is unwarranted," Aetna U.S. Healthcare said.

The lawsuit marks the first time that the AMA and a state medical association have been plaintiffs in litigation regarding prompt payment. The providers are out to prove a point.

"Through this lawsuit, we hope Aetna and other insurance companies understand that physicians...are no longer willing to accept harmful business practices," said Paul Shanor, executive director of the Medical Association of Georgia. "Delaying payment of claims hurts Georgia's physicians by making payment for services rendered uncertain. Patients are also hurt. Some patients have lost their physicians because of Aetna's payment policies."