Alleging managed-care companies routinely deny and delay claims without justification, Florida physicians have filed class-action lawsuits against Prudential HealthCare and AvMed.
In addition, the Florida Medical Association filed a complaint with the Florida Department of Insurance charging that Roseland, N.J.-based Prudential routinely downcodes physicians' claims, or pays physicians less than they're entitled to based on the care they provide. All patient visits and procedures are billed according to a system of codes, based on complexity. The higher the code, the greater the reimbursement.
The Tallahassee-based FMA, which represents about 16,000 of the state's doctors, is considering a similar complaint and lawsuit against Minneapolis-based United HealthCare Corp.
Relations between providers and insurers in Florida have been strained for months. Earlier this year the state Insurance Department advised healthcare giant Aetna U.S. Healthcare that it must revise its managed-care contracts because they violate state law. This latest go-round indicates physicians are likely to pursue legal and regulatory action against managed-care companies they feel slighted by.
"I've never sued anybody in my life," says Jacksonville obstetrician William Cody, M.D., who initiated the class-action suit against Miami-based AvMed, which was filed in circuit court in De Land, Fla. "I've been trying to avoid this and can't believe it was coming down to this -- a lone individual like me taking on a giant like AvMed."
Cody says AvMed owes his solo obstetrics and gynecology practice more than $25,000, and the insurer has been rejecting or denying any claim of more than $250.
FMA general counsel John Knight says the association turned to the state Insurance Department after hearing numerous complaints from members about Prudential. Prudential's Florida network has about 7,500 physicians serving about 505,000 commercial enrollees in the state.
"It is our allegation that under (Florida) statutes, it is illegal for Prudential to downcode without first requesting a copy of physicians' medical records," Knight says.
Prudential has responded fully to the Insurance Department's request for information, according to plan spokeswoman Marlene Baltar.
"Overall, the majority of claims are paid as submitted. In some instances, claims that are changed are simply rightcoded," she says. "In these cases, physicians have the right to appeal decisions made by the plan."
Spokesman Don Pride says the Insurance Department is currently investigating Prudential's market conduct and will issue a report by year's end. Prudential then will have an opportunity to respond to the report and, if necessary, take corrective action.
The FMA's Knight says a similar complaint against United likely will be filed this month. United says it's now reviewing all claims submitted for routine office visits.
"We had looked at claims over the past year to see where the request for reimbursement matched the service rendered, and we saw a certain degree of upcoding, either intentional or unintentional," says Fred Dunlap, president of United HealthCare of Florida and Puerto Rico.
The class-action suit against Prudential alleges the insurer is in violation of both state law and its own contracts because it failed to pay on a timely basis.
The suit was brought by the Jacksonville-based Florida Physicians Association, a 3,000-member sister organization of the FMA, and North Florida Obstetrics and Gynecology Associates, a large Jacksonville group practice.
The FMA since has signed on to the suit, which is currently before a federal court in Jacksonville. The suit, filed on behalf of all physicians in Florida who have participated in Prudential plans, seeks interest on the late payments.
For the North Florida group alone, this amounts to about $75,000.
According to Don Weidner, executive director of the FPA, Prudential routinely denied or delayed all claims exceeding $1,000 until patients confirmed Prudential was their primary insurer -- an arduous, time-consuming process.
Prudential's Baltar says the insurer pays about 92% of claims within 30 days and about 97% within 45 days. She says the company requires additional insurance information to make sure Prudential is not paying claims other insurers should be paying. The plan will not pay more than $10,000 in claims (a figure that was increased from $1,000 earlier this year) if that information isn't provided.