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UHC/PacifiCare
Faces Industry Scrutiny and Huge Potential Fines
The California Department of Managed Health Care (DMHC) has issued a $3.5 million fine against PacifiCare (purchased by UnitedHealth Group in 2005). Additionally, the Department of Insurance is expected to release the results of their own investigation, which will likely result in additional fines being issued. Both investigations centered around claim processing practices from 2005 to 2007, which include claim processing time, reimbursements to members and physicians, and the calculation of interest. PacifiCare has commented that a majority of the issues were a result of the merger with UnitedHealth, as they did not estimate the time or resources required to integrate the two computer systems and networks.
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New York State Attorney General
Investigates Health Care Billing Practices by UHC and Other
Insurers
The Attorney General for the State of New York, Andrew Cuomo, recently announced an investigation into the out-of-network reimbursement practices of health insurers. Mr. Cuomo contends the insurers billing practices are an attempt to deceive and defraud customers based on the method of establishing “reasonable and customary” charges. The "reasonable and customary" amount is developed for any given service in a particular geographic area, and is based on the Ingenix Prevailing Healthcare Charges System (PHCS).
As part of the investigation, Mr. Cuomo announced his plans to sue UnitedHealth Group. He also announced that his office had issued subpoenas to 16 other insurers doing business in New York State, including Aetna, CIGNA and Empire Blue Cross/Blue Shield.
In a written statement, UnitedHealth Group denied any wrongdoing and defended it's practices saying,
"the information provided by the Ingenix PHCS is rigorously developed, comprehensive, geographically specific and organized using a transparent, longstanding methodology that is very common in the health care industry."
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California
Health Care Reform (AB1X) is Defeated
Senate Bill AB1X, projected to cost more than $14 billion and insure almost 7 million residents, has been overturned. The members of the
Senate voted 7 to 1 against the reform based on too many uncertainties and the lack of adequate funding which could ultimately lead to increased budget problems for the state.
The health care reform would have mandated that all Californians receive coverage through their employer or through an employer funded state pool.
Schwarzenegger and other supporters can resubmit an amended bill to the health committee and restart the approval process as early as the next scheduled meeting.
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Medical Insurers are
Moving Toward Covering Online Visits for Minor Illnesses
Online medical services are becoming a new trend of the future. Virtual office visits are being considered an efficient and effective practice for minor ailment follow-up consultations and treatments. Two of the nation’s largest insurers, Aetna and Cigna have already decided to launch this online tool and are agreeing to provide reimbursements to doctors. Other medical carriers are expected to follow suit in the
future. More
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FMLA is
Amended to Provide Leave for Families of Armed Forces Members
On January 28, 2008 President Bush signed into law H.R. 4986, the National Defense Authorization Act of 2008. The act amends the existing Family Medical Leave Act (FMLA) by expanding leave benefits for the family members of U.S. military personnel in two key ways.
Effective January 28, 2008, the law requires employers to provide up to 26 weeks of unpaid leave within a 12-month period to employees who are caring for service members wounded in the line of duty. Eligible employees include spouses, children, parents, or next of kin of the service member.
The law also requires employers to provide 12 weeks of FMLA leave to the immediate family members of service members who are taking part in a “contingency operation” or because of any “qualifying exigency.” A “contingency operation” is defined as a military operation that results in a service member being retained or called to duty. A “qualifying exigency” is not defined in the bill and therefore this provision will not be effective until the Secretary of Labor issues final regulations defining it. However, the Department of Labor (DOL) encourages employers to provide employees with this type of leave.
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