Aetna has dismissed its lawsuit against Mednax, marking the end to a three-year-long legal battle that claimed the neonatal services provider ordered $50 million worth of unnecessary tests.
The Hartford, Conn.-based insurer, which is owned by CVS Health, filed a voluntary dismissal with the U.S. District Court of Eastern Pennsylvania on Wednesday. Each side will bear its own costs. Aetna did not immediately respond to an interview request.
But according to Aetna's complaint, in January 2015, the insurer contacted Mednax over suspicion that the company was exaggerating the severity of the clinical condition of its newborn patients and ordering unneeded checks.
Over the next year, Aetna said it met with Mednax multiple times to share a statistical analysis of the company's testing and billing practices. In response, the lawsuit states that Mednax hired numerous outside lawyers, who met with Mednax's in-house counsel to discuss protecting records related to the suit, among other things.
Mednax's internal billing and coding system, named BabySteps, automatically deletes emails after 90-days unless lawyers place a "litigation hold" on the correspondence. Despite these conversations and knowledge of Aetna's legal complaint, Mednax failed to place a litigation hold, telling Aetna that pausing the system "slipped through the cracks."
In March, Aetna sent a memorandum to the court, saying Mednax destruction of evidence "severely prejudiced" the insurer's case and asked the court to implement adverse inference, which means it may hold Mednax's silence against it. Today, Mednax CEO Mark Ordan said he was pleased Aetna dismissed the suit.
"Our core mission is to do what's absolutely best for our patients: mothers and children at their most vulnerable times," Ordan said in a statement. "CVS Aetna's website speaks the same language about care, so we hope this can be a start of building a positive relationship for the sake of our patients."
