LOS ANGELES - In an expansion of its ongoing effort to expose and prohibit an industry-wide health insurance scheme to defraud patients and physicians of proper reimbursement, the American Medical Association (AMA) today announced it is among several medical societies that filed a class action lawsuit against WellPoint, Inc.

The lawsuit, filed today in Los Angeles federal court, alleges that WellPoint colluded with others to underpay physicians for out-of-network medical services, resulting in patients paying an excessive portion of the medical bill.

"Physicians will not tolerate an apparent conspiracy that allows health insurers to play by their own rules without regard to patients, or the legitimate costs required to care for them," said AMA President Nancy H. Nielsen, MD.

A Long-Running Problem

The problem has been going on for a long time in the U.S. health care system. AMA filed a lawsuit against United HealthCare in 2000. Recent legal actions have shed light on these insurance practices, most notably an investigation by New York Attorney General Andrew M. Cuomo. (See www.dotmed.com/news/story/7958.) His year-long investigation confirmed that the Ingenix database is intentionally rigged to allow insurers to shortchange reimbursements.

"What has been accomplished so far with all of these insurers thanks to Attorney General Cuomo are ground-breaking settlements so insurers don't use the Ingenix database in the future," AMA spokesperson Robert J. Mills told DOTmed News. "What remains to be resolved are the damages related to the prior use of the Ingenix database. That is why it is necessary to have it discussed in court."

Today's action represents a significant milestone in the fight.

"WellPoint is the largest commercial insurer in the U.S. so the impact of price fixing where it colluded with other insurers is a clear conflict of interest," Mills said. "It has always been on the AMA's mind that it is an invalid system that needs to be reformed."

The AMA filed similar class action lawsuits last month against Aetna Health, Inc. and CIGNA Corporation. The three AMA lawsuits claim that each insurance company conspired with Ingenix, a unit of United Health Group, on a price fixing scheme that relied on an obscure database to set artificially low reimbursement rates for out-of-network care.

In addition to seeking reforms for the invalid payment systems used by Aetna, CIGNA and WellPoint, the AMA and partnered medical societies also seek relief for physicians who were seriously harmed by the insurers' long-term use of the flawed Ingenix database.

The Litigation Center of the AMA and State Medical Societies is supporting the WellPoint lawsuit in partnership with the California Medical Association, Connecticut State Medical Society, Medical Association of Georgia and North Carolina Medical Society.

To view the individual legal complaints filed against Aetna, CIGNA or WellPoint, please visit the AMA Litigation Center Web site:
http://www.ama-assn.org/ama/pub/physician-resources/legal-topics/litigation-center.shtml

And watch for Senate hearings this week.

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