Not long ago, two similar lawsuits based on out-of-network provider issues were contested in the Texas Federal Court. Both the cases included Humble Surgical Hospital as the defendant, which was accused of submitting inflated bills to the two insurance companies-Connecticut General Life Insurance Co. (Cigna) and Aetna Life Insurance Co. (Aetna). Interestingly, the two cases had rather conflicting outcome; Cigna’s $5 million claim was overturned and it was asked to pay $13.6 million to Humble instead; Aetna, on the other hand, won its claim, giving it the authority to collect up to $51.4 million from Humble. So what exactly happened differently in the two cases appearing so similar to one other, after all?
Cigna vs. Humble
The first federal lawsuit involved Cigna that sued Humble Surgical Hospital, LLC for recovering overpayments made to the latter due to fraudulent billing practices. These practices violated both Employee Retirement Income Security Act of 1974 (ERISA) and state common law. The court found it otherwise, and instead awarded Humble to collect about $13 million from Cigna for alleged underpaid claims as well as ERISA penalties. The court’s decision was based on two conclusions; it determined that Cigna applied the exclusionary language within the plans it administered improperly, and; Cigna failed to establish that the language used in documents led to the formation of constructive trust.
Aetna vs. Humble
The second federal lawsuit (Aetna vs. Humble) that was filed 7 months later sprung a surprise on the Humble. After a heated discussion and with the appropriate documents handy, the judge determined that Humble ran a kickback scheme to give physicians additional payment for referring patients, and also submitted inflated bills to Aetna. The federal court ordered the hospital to pay in the tune of $51.4 million ($41.4 million for the overpayments and $10 million as the interest) to the insurance company, which also led to the facility filing for bankruptcy.
The two Texas cases did make it clear that even the smallest of physician groups/hospitals can fight cases lawsuits against the bigger insurance firms despite having insufficient resources; and no facility, big or small, can win the judgment based on the guidelines, which can be seemingly evaded, in order to turn the ruling in their favor. For more on these cases and how OON providers can avoid penalties, join expert speaker Thomas J. Force, Esq. in a live audio conference, titled ‘Reconciling Cigna v. Humble with Aetna v. Humble and Their Impact on the Out-of-Network Provider’ on Thursday, March 16, 2017. During this event, Thomas will closely examine both the cases and offer advice for OON facilities on avoiding adverse outcomes regarding balance billing, fee forgiveness and referral deals with physicians.
