Cigna and American Specialty Health Agree to Pay $11.8 million 
in Settlement with Chiropractic Care Centers

In another blow to middleman rationing activities we recently learned that in April Cigna & American Specialty Health (ASH) agreed to an $11.8 million settlement that will resolve litigation with a proposed class of chiropractic care centers whose patients were denied claims.

One of the allegations in the case was that ASH's utilization management policies violate the Employee Retirement Income Security Act of 1974 (ERISA) as applied to chiropractic. ASH imposes a pre-authorization requirement after the first 26 visits, which violates the terms of the underlying employee health plans. The chiropractic centers filed a motion asking the judge to approve the agreement that requires American Specialty Health and Cigna to pay monetary compensation for claim denials and to make other changes to its business.

According to the motion, the nearly $11.8 million settlement amount equals a substantial portion of what the centers would have received had Cigna approved and paid in full the claims that are the subject of the litigation. American Specialty Health also agreed to make certain business reforms, including adding more chiropractic associations or out-of-network providers to its Professional Affairs Health Advisory Committee and offering more free continuing education to providers. According to Mr. Hufford, the American Chiropractic Association now has a representative on the ASH Committee, on which the Illinois Chiropractic Society has had a representative for several years.

American Specialty Health and Cigna have denied the allegations of the complaint and declined to comment on the settlement agreement. However, this resolution, if approved by the court, provides some compensation for ASH's failure to follow the terms of the affected patients' health plans.

The attorneys involved in this case came to our 2017 Unencumbered Meeting in Long Beach seeking input on similar situations involving physical therapy centers.

FINALLY PAYERS & MIDDLEMEN ARE BEING HELD FINANCIALLY ACCOUNTABLE FOR THEIR ACTIONS THAT DELAY, DENY AND INTERFERE WITH PATIENT CARE. PERHAPS THIS WILL SPUR CHANGES IN THEIR BEHAVIOR.

In any case, iPT and our members will stay diligent in monitoring how Cigna & ASH delay, deny and interfere with patient care in our physical therapy world.